Meeting of the Parliament

Meeting date: Thursday, May 9, 2019

Official Report 1031KB pdf

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Pension Credit

The next item of business is a members’ business debate on motion S5M-15570, in the name of Kenneth Gibson, entitled “Changes to Pension Credit Could Cost Mixed-age Couples £7,320 Annually”. The debate will be concluded without any question being put.

Motion debated,

That the Parliament condemns the UK Government’s decision that, from 15 May 2019, newly-retired people whose partners are younger than the state retirement age of 65 will no longer be able to claim pension credit (PC) and must instead claim universal credit (UC) along with their partners; understands that the couple rate of UC is £114.81 a week, compared with £255.25 for a couple receiving PC, which amounts to a potential loss of £7,320 a year; believes that this change could have a devastating impact on couples’ finances, health and wellbeing and increase the number of older people in poverty; considers that, if the change comes into force, couples might find themselves in the position of being financially better off if they split up and live apart; is disappointed that the changes were set out in a written statement by Parliamentary Secretary for Pensions and Financial Inclusion, Guy Opperman MP, which was published online on the evening of 14 January 2019; believes that this allowed the announcement to go through largely unnoticed due to the Brexit vote, and notes the calls for the UK Government to reconsider this decision, which, it believes, could drive many older people and their partners in Cunninghame North, Scotland and across the UK into poverty.

12:46  

First, I thank Age Scotland and Engender for their helpful briefings. When I lodged the motion back in January, I held on to some hope that the United Kingdom Tory Government would reconsider its callous decision to force newly retired people whose partners are younger than the state retirement age of 65 to claim universal credit rather than pension credit. Unfortunately, as the change is to come into force next Wednesday—15 May—the Tories seem to have chosen to ignore the calls from Age Scotland, Citizens Advice Scotland, Engender, MSPs, MPs and campaigners who have expressed concerns about the impact that the change will have on some of Scotland’s poorest pensioners.

This is no minor change—the switch to universal credit could cost affected households £140.44 a week or £7,320 a year. The pension credit guarantee tops up a couple’s income to a minimum of £12,940 a year. Under universal credit, the standard allowance entitles couples to less than half that. Such a cut could devastate a couple’s finances and ultimately their overall health and wellbeing. As Age Scotland said when the announcement was sneaked out on the day of the first meaningful vote on Brexit,

“Such an outrageous new policy will do nothing but penalise older couples of mixed age, making them poorer for living together.”

As if forcing people on to universal credit—the problems of which are well documented—was not bad enough, the loss of pension credit will have a profound impact on other aspects of social security delivery, as it is a passporting benefit. People who are eligible for pension credit receive free national health service dental treatment, cold weather payments and help with housing benefit and council tax.

The loss of such support can only impoverish our poorest pensioners. To illustrate that, I offer the example of a mixed-age couple who rent a one-bedroom property in North Ayrshire that is in council tax band C and has a monthly rent of £373. If they receive a state pension of £160 a week and pension credit, their total loss after being moved to universal credit will be £9,223.80 a year, which is an enormous sum. The Scottish Government estimates that, by 2020-21, 3,800 mixed-age households in Scotland will collectively lose about £20.8 million.

It is shocking that the UK Tory Government has not considered that the change might force couples who find themselves financially pressured to split up. It argues that pension credit was not designed for working-age claimants, but universal credit was never designed for pensioners, as it includes no additional support for a couple in which one member is not expected to work because they are over the state pension age. The justification for the policy is therefore deeply flawed.

Even more gallingly, as I touched on, the changes were sneaked out in a written statement by the Parliamentary Under-Secretary of State for Pensions and Financial Inclusion, Guy Opperman MP, on the evening of 14 January 2019, when the Prime Minister suffered a crushing defeat at Westminster as MPs rejected her Brexit deal. That drama allowed the pension credit changes to be buried deep in the news agenda, even though they will drive many older people and their partners in Scotland—and across the UK—into poverty.

Age Scotland responded quickly to the statement and is working hard to help as many eligible people as possible to claim pension credit before the 15 May changeover.

Tories might try to cover their backs by stating that this change was legislated for in 2012 and it is too late to turn the tide. However, I note that Age Scotland told the Social Security Committee that the Welfare Reform Act 2012 was 182 pages long, with provisions on mixed-age couples buried among provisions on the introduction of universal credit and personal independence payments. Further, I point out that the changes can still be stopped.

The UK Government presented the reforms as gender neutral because universal credit treats women and men in the same circumstances equally. However, Engender understood that pension credit changes will compound the situation that is already faced by women who are affected by the increase in the state pension qualifying age. Changes to pension credit entitlement, which might otherwise have offered a lifeline to women against state pension inequality, will hit that group of WASPI women especially hard. In addition, women are more likely to be the younger person in a couple and have to work or claim working-age benefits despite the likelihood that they already have unpaid caring duties.

It seems that the UK Tory Government cares little about the impact that the policy will have. When it announced the change, the UK Government must have known how many people would be affected in each UK nation. Such information is crucial to devolved Governments and the third sector, as it enables them to adequately prepare their services. In spite of that, the UK Government has still not provided a comprehensive geographic breakdown.

Of course, with Michelle Ballantyne as their welfare spokesperson, it is little surprise that Tory MSPs have not challenged their Westminster counterparts to reverse or delay the change. When asked at the Social Security Committee two weeks ago today whether she would sign a letter from the committee asking for a six-month extension to the 15 May and 13 August deadlines, to allow both the Scottish and UK Governments to do all that they can to maximise benefit uptake, she replied:

“do I care one way or the other? I probably do not, actually, if I am honest”.—[Official Report, Social Security Committee, 25 April 2019; c 52.]

That perfectly encapsulates the indifference that Tories have towards the real suffering that their policies inflict. Those same Tories propose to take free television licences away from over 75s and to deny women born in the 1950s their full right to state pensions, and they are pushing thousands of pensioners into poverty when the UK already has one of the lowest earnings-to-pensions ratios in Europe.

It is imperative that fairness be at the heart of our pension system and that older people be treated with dignity. The risks are not just financial. People on lower incomes are also susceptible to poorer health. Reducing the incomes of some older people will force them to choose between heating and eating. It is undeniable that those who cannot afford to heat their homes are more likely suffer from poor health, which places more stress on our national health service. The Scottish Government and our local authorities will be left to pick up the pieces of this disastrous, short-sighted policy.

It is unrealistic to expect the Scottish Government to mitigate the impact of the cut. To do so for each Tory welfare reform would be impossible. By 2020-21, it is estimated that mitigating UK welfare cuts would cost £3.7 billion, which is three times the Police Scotland budget. Meanwhile 100 per cent of national insurance contributions that are raised in Scotland flow to the Treasury.

I encourage any older person who is listening today and is concerned about their income to call Age Scotland’s excellent helpline. It is free and available from Monday to Friday from 9 am to 5 pm on 0800 12 44 222. It offers free benefit checks and can support older people with pension credit claims. It is vital that older people claim the support to which they are entitled.

Any situation in which an older person would be financially better off living alone claiming pension credit than living as a couple claiming universal credit is unacceptable. The UK Tory Government must act to prevent that, and must act now.

12:53  

I actually thank Mr Gibson for bringing this debate to the chamber, because, hopefully, it will ensure that anyone who is entitled to pension credit is made aware of the changes so that they can, if they want to, apply before the deadline.

Mr Gibson is right on a couple of points. The change was part of the 2012 act. The decision was made at that point, and there was debate and discussion around it at that time. He is also right that the announcement reminding people of the date of the change was made on the date that he said that it was. That was a concern to everyone. However, it is important to note that, although the change to entitlement takes place next week, applicants have until 13 August 2019 to register a backdated claim if they are eligible next week. That gap is really important in terms of making sure that as many people as possible get what they are entitled to at the moment.

Eligibility for benefits is probably one of the most contentious subjects and, whatever the decisions of Governments, there will always be individuals and organisations who will argue that a decision is not fair. It is, therefore, the role of Government to try and find a balance that is consistent in its application and transparent to people.

Pensions are particularly complicated. We currently have a situation in which people who have not reached state pension age can claim pension-age benefits. Pension credit is designed to help our most vulnerable elderly—people who have not built up a pension and have no other recourse to funds after they reach retirement age. It is rightly designed to ensure a minimum level of income, and I have no doubt that every member in this chamber supports it.

When Mr Gibson and others talk of a loss of income for mixed-age couples of £7,320, that will cause alarm. It should do. However, it should be made clear that the change is not retrospective: any mixed-age couple who are currently in receipt of pension credit or who successfully apply before the deadline will not lose the benefit unless their circumstances change.

The question that arises in relation to mixed-age couples is whether a working-age adult should be exempt from the obligations that their peers incur, by dint of a partnership with a pensionable individual.

As pension credit has a 100 per cent withdrawal rate for earnings over a small threshold of around £10 per week for most couples, there is a disincentive for a younger partner to work. The difference that Mr Gibson quotes assumes a couple who have no income beyond their welfare entitlements. However, as universal credit has a 63 per cent withdrawal rate for earnings over a much larger allowance—about £503 for a couple—the reality is that any pension that the older partner has, or any income that the younger partner earns, will mean that the gap is smaller.

An area of real concern to me is the entitlement to passported benefits. We should look closely at that area, because of the potential impact of the change. We should do so particularly because a number of the relevant benefits are being devolved to the Scottish Parliament, and the Scottish Government will be able to make decisions about the criteria and entitlement.

Around two thirds of people who are eligible for pension credit do not currently claim the benefit. I do not want anyone who is struggling to miss out on what they are due. I hope that this debate raises awareness.

On Mr Gibson’s comment about what I said in committee, I cannot remember, off the top of my head, whether the discussion was in private, but if it was I will certainly bring the matter back to the chamber to discuss—[Interruption.] However—

Will the member give way?

However—

Members: Give way!

However, my comment was—[Interruption.] Do members want to hear what I have to say?

On a point of order, Presiding Officer.

It had better be a point of order. If it is a debating point, it is not a point of order. I warn you, Ms White. Go ahead.

Thank you, Presiding Officer.

Ms Ballantyne said that the comment was made in private—

No, I did not.

It was not in private; it is all over the newspapers—

I heard what—

It was not in private.

Excuse me, Ms White. Please sit down.

I heard what was said, and that is not what Ms Ballantyne said; she said “if”.

Members should listen.

I will not take comments from the Conservative front bench, either. The matter can be raised by members in the debate, if they wish, or afterwards. Thank you.

Please continue, Ms Ballantyne.

I was merely going to say that the comment was in reference to whether we should send a letter at that time and was backed up by my saying, if I remember correctly, that I felt that we were probably too late.

12:58  

At the weekend, Ruth Davidson returned to front-line politics and said, in her conference speech, that a secure pension age has gone. That is too true. Pension security in the UK has gone, and the Tories are set to make life even harder for pensioners. I thank Kenneth Gibson for securing this debate to allow the matter to be discussed.

Changes to pension credit will cost the poorest in Scotland up to £7,000 a year. That is a large chunk of money for anyone to lose, and for our poorest pensioners it will mean a choice between eating and heating.

The fact is that the UK state pension is already the worst in the developed world. According to data from the Organisation for Economic Co-operation and Development, the UK Government pays out only 29 per cent of earnings, which puts it at the bottom of the table. Let me compare that with what other European Union nations provide. The Netherlands pays out 100 per cent, Portugal offers 94 per cent and Italy offers 93.2 per cent.

Before the independence referendum, in 2014, Labour’s Gordon Brown warned that Scotland’s leaving the UK would come with a pensions “time bomb”, and the Tory Government backed that claim. We now know that the Tory Government went on to increase the pension age for women without notice, which means that some women will lose up to £30,000. Now, that is a pensions time bomb, and I stand with the WASPI women in their condemnation of the UK Tory Government, which has let them down.

Low earners and women are bearing the biggest cost of pension reforms, and the number of pension-age people who have to use food banks is a national disgrace. Of course, the announcement of this latest pensions time bomb was revealed by the Tory Government on the eve of Prime Minister Theresa May’s humiliating Brexit-deal defeat in January—it was slipped in under the radar, with no debate or vote in the House of Commons. The cut was made as part of the Welfare Reform Act 2012, and the pensioners of the UK, present and future, have been scammed.

This is simply more bad news for women who were born in the 1950s, who have already been affected by the increase in the state pension age.

Will the member take an intervention?

No, I will not.

Hundreds of women in North East Scotland and in my constituency of Aberdeenshire East have been affected by the increase in the pension age. I have met them repeatedly, and I stand with them in their condemnation. They are already struggling under the weight of the changes that have been made, and this policy could impact them even further.

My party does not support the unfair manner in which the changes were made, and we have repeatedly asked the UK Government to give those women their money. More than 2 million women have been affected by the changes that have already been made, and changes to pension aid will cause them more financial uncertainty. People who also claim a disability benefit will be heavily impacted—and more than 50 per cent of those who receive pension credits also claim a disability benefit. In 2018, the Joseph Rowntree Foundation’s report on UK poverty highlighted that previous falls in pensioner poverty were due, in part, to the introduction of pension credit.

Members of the Labour Party are not off the hook, as they campaigned with the Tories in 2013 and 2014 to frighten pensioners into thinking that they would lose their pension in an independent Scotland. It is time that we took control of pensions for our Scottish older people and gave them the retirement that they deserve. The UK is not working for Scotland’s pensioners.

13:01  

I, too, thank Kenneth Gibson for securing this debate on an issue that will affect thousands of pensioners and couples across the country. The motion condemns the Tory Government’s decision to make the change, and I certainly support that. It is a particularly harmful change to the way in which pensioners and mixed-age couples receive income, and it will undoubtedly result in hardship, pushing people further into poverty and affecting their health and wellbeing.

Although this detrimental change is part of the Tories’ failed austerity policies, which have caused misery for families up and down the UK, it is disappointing that the Scottish Government has not done more to raise awareness of it. However, Kenneth Gibson’s motion and this debate should help to do that, since the change will take place imminently.

A further issue—which has been mentioned—is the high number of people who are eligible but not claiming due to lack of awareness. As I mentioned when I asked a question in the chamber last week, Age Scotland cites figures from the Department for Work and Pensions, which estimates that up to 40 per cent of couples who are entitled to receive pension credit are not receiving it. Although couples who currently receive pension credit will not be affected by the upcoming changes immediately, they could be affected if their circumstances change at any point in the future. That is a massively important point that must be made in the debate.

This policy is the latest in a long line of Tory Government reforms that, as usual, will have a greater impact on the most vulnerable in society. Age Scotland tells us that 38 per cent of people who are over the age of 50 are financially squeezed and that four in 10 pensioner couples struggle to pay their bills. Pension credit is a vital tool in helping people who are in pensioner poverty, which affects an estimated 170,000 people in Scotland.

There is no doubt that the benefit change will also have a greater effect on women. As Gillian Martin mentioned, those woman have already suffered due to the increased state pension age, because they were not adequately warned of that or given time to make alternative arrangements for retirement. These new pension credit rules will have a further harsh impact on those women. As Kenneth Gibson mentioned in his opening speech, although the UK Government has presented its welfare reforms as being gender neutral, the circumstances of men and women who apply for universal credit are rarely the same and are often very different.

That is due to the societal persistence of underlying traditional gender norms, with many women spending longer out of work and at home in caring roles. As a result, state and private pension levels are more unfavourable to women. Part-time work, the gender pay gap and historic maternity and gender discrimination at work also mean that contributions will have been lower and perhaps that no national insurance contributions will have been made. Women who have had Iong or multiple breaks in employment are also often more reliant on the basic state pension as their core income. Clearly, the change has not been poverty proofed, and neither has it been subject to a gender impact assessment.

The impact of the policy does not even end with the people who are directly affected, as there will also be unintended consequences for local economies. If new applicant couples are in receipt of over £7,000 less per year, that will definitely impact on local economies. Our high streets have long been declining as more people shop online and jobs are being lost, and pensioners are still the people who are least likely to buy online. Even if the Tories are not interested in personal hardship, I would have thought that the impact on business might cause them some concern.

In conclusion, the UK Government really must think again about this harmful policy change. If it is not going to do that—and it does not look as though it is—the Scottish Government needs to do its best to highlight the fact that the change is happening imminently, as it will undoubtedly have a massive impact on pensioner poverty in this country.

13:05  

I thank Kenny Gibson for bringing this very important issue to the chamber for debate today.

It seems that, just when we have got our heads around one change and its impact, along comes another, often affecting the very same people. The change to pension credit that is outlined in the motion is yet another policy that will have a hugely negative impact on the incomes of the households that are affected. Some 3,800 households in Scotland could be as much as £7,000 a year worse off claiming after 15 May compared to claiming before.

With so many cuts and changes coming down the line, it is all the more important that people are well informed, yet, as we have heard, that has not happened. The new mixed-age couple rules were legislated for as long ago as 2012, as has been mentioned, yet they were announced only in January, just four months before the policy will come into force, in the most low-profile way possible—a written statement.

There are clear parallels with the change to women’s state pension age, which was similarly legislated for ahead of time but was not clearly notified to people. As a consequence, WASPI women are retiring much later than they thought they would, with their plans for retirement in tatters. It is shocking that the lesson that is highlighted by the tireless campaigning of the WASPI women has not been learned by the UK Government.

The situation is made even worse by the fact that pension credit already has an insufficient take-up rate, with 40 per cent of those who are eligible for it not claiming it. That means that many couples who are eligible to claim under the current system will, in less than a week, have to claim under the new system and may lose thousands of pounds as a result. There simply has not been enough time for organisations that support older people to raise awareness.

The DWP’s justification for that is that pension credit was not designed for people of working age and that the change will mean

“the same work incentives apply to the younger partner as apply to other people of the same age”.

Although pension credit may not have been intended for people of working age, it is equally true that universal credit was not intended to be claimed by pensioners. It includes no additional support for a couple when one partner is not expected to work because they are over the state pension age, and, as the state pension age rises, they will be in that unfair situation for longer.

The phrase “work incentives” is very telling: this is really about making the younger partner subject to benefit sanctions. Yet, we have overwhelming evidence suggesting that benefit conditionality and sanctions do not work. A study by the University of Glasgow and Heriot-Watt University found that

“the threat or experience of a benefit sanction ... is routinely ineffective in facilitating people’s entry into, or progression within, the paid labour market over time”

and causes huge stress and worry in the process.

In the name of extending the reach of benefit sanctions yet further, the UK Government is making almost 4,000 households worse off. That is shameful. It is no surprise that Age Scotland refers to it as an

“outrageous new policy”

that

“will have a devastating impact”

on

“Scotland’s poorest pensioners”

and is urging the Government to reverse it.

I, too, draw attention to the gendered impact of the policy, which has been highlighted by Engender and other members in the chamber. It is yet another change to social security entitlements that hits women harder than men. In this case, women are more likely to be the younger partner and subject to conditionality. For women who have been impacted by poorly notified increases in the state pension age, the changes to their pension credit entitlement, which may otherwise have offered a lifeline for them in the absence of their pension, mean that they will be hit especially hard.

Greens are dismayed by yet another hole being made in our already severely frayed social security safety net—one that was announced in the quietest way possible—meaning that couples who might have been able to exempt themselves will no longer be able to do so, and all to extend a thoroughly discredited system of sanctions.

13:10  

I thank Kenneth Gibson for bringing the debate to the chamber.

As we have heard, from Wednesday newly retired pensioners will be barred from claiming pension credit if they have a partner who is younger than state pension age, and will instead be forced on to universal credit. Estimates of the impact of the changes on the average claimant are in the region of £5,000 to £6,000 per year. The financial consequences could be even more far reaching than that.

As members will know, pension credit is a passporting benefit, which means that mixed-age couples could lose out on other forms of assistance, including cold weather payments, housing benefit, council tax reductions, social fund funeral payments and, possibly, their entitlement to the warm home discount.

As if the policy was not bad enough, the means by which it was delivered adds considerable insult to injury. As Kenneth Gibson said, by sneaking the amendment out by way of a written statement from a DWP minister on the same day as the first meaningful—if I may use that word rather broadly—vote in the House of Commons on Brexit, the UK Government clearly wanted it to go as unnoticed as possible and to avoid scrutiny of a decision that it knew very well would be unpopular.

I pay tribute to Age Scotland for its efforts in highlighting the changes. It is certainly worth considering a hypothetical example that has been provided by Age Scotland to illustrate what the changes could mean for a typical household in the situation. Peter, aged 70, draws a state pension of £140 a week. His wife, Jean, aged 62, gave up work five years ago to care for her father, who has recently died. They own their own home and have a few hundred pounds in savings. They receive pension credit to top up their joint income to £248 a week. After the rule change, Peter and Jean’s position will be protected if they are still receiving pension credit when any changes come in, as long as their circumstances stay the same.

However, a couple in that situation who need to claim benefits for the first time after 15 May 2019 would not be entitled to pension credit, due to Jean’s age. Peter’s state pension is too high for them to receive universal credit, so their joint income will be just Peter’s state pension. If Jean cannot find a job, which might be difficult, given her age and time out of the labour market for caring, that will be their income for another four years, until Jean reaches SPA at age 66. By that time, Peter will be 74.

However, if Peter was living on his own, because they had separated or Jean had died, he would be able to claim pension credit, in which case his state pension would be topped up to £163 a week—which is considerably more than the universal credit standard rate for a couple, which is about £115 a week.

It is clear from that and many other examples that changes to pension credit will have a significant impact on mixed-age pensioner households when they come into force next week.

For the UK Government to penalise people simply for having a younger partner is completely unacceptable. The benefit is designed for our poorest pensioners, who should not be forced to pay the price of the Tories’ ideologically driven cuts to welfare.

The UK Government and its supporters cannot continue to brush aside the deep and damaging failings of its social security system. Mr Gibson said that only a few weeks ago in committee. When the Tories’ social security spokesperson was asked whether she would support a cross-party letter to the UK Government calling for a delay to the changes, she replied:

“do I care one way or the other? I probably do not, actually, if I am honest”.—[Official Report, Social Security Committee, 25 April 2019; c 52.]

I hate to break this to Michelle Ballantyne, but that comment was not made in private session. I was quoting from the Official Report; the discussion is on the public record.

The more important point is that the indifference of the UK’s governing party continues to push families into poverty and forces people to turn to food banks so that they can get by. I hope that this Parliament, in contrast, does not share the Tories’ indifference about the matter. It is time for the Tories to reverse the attack on low-income pensioner households.

In view of the number of members who remain to speak in the debate, I am minded to accept a motion without notice, under rule 8.14.3, to extend the debate by up to 30 minutes.

Motion moved,

That, under Rule 8.14.3, the debate be extended by up to 30 minutes.—[Kenneth Gibson]

Motion agreed to.

13:15  

It is important to start by explaining what pension credit was designed to do. It was designed to provide long-term support for pensioner households that are no longer economically active—“economically active” being the key words. Pension credit was never designed to support working-age claimants, so it is simply wrong to make that claim.

The Scottish Conservatives want to make work pay, and to encourage people to be in work. The change means that the same work incentives will apply to the younger partner, as well as to other people of the same age. It will ensure that taxpayer support is directed towards those in society who most need help.

We need to be careful to make it clear that the change is not retrospective. I am sure that Gillian Martin did not say that it is, but that was, perhaps, implied. Anyone who is in receipt of the benefit now will not be affected by the change; pension credit will still be paid to current mixed-age pensioner couples. New claimants and, as we have heard, people whose circumstances change will be affected. Therefore, we need to be careful about the language that we use in the chamber.

Does Jeremy Balfour have a view on whether the outrageous policy might be subject to legal challenge in relation to sex discrimination, or on whether it undermines the right to family life, as set out in the Human Rights Act 1998?

As I have not practised law for more than 30 years, I will avoid getting into a legal debate.

An issue on which there might be consensus relates to take-up. As Alison Johnstone said, at least 40 per cent of people who could claim the benefit are not doing so at the moment, which is disappointing. I agree that the way in which the policy was announced was, perhaps, disappointing, and that there has been a lack of advertising about what will happen from the UK Government. However, as Michelle Ballantyne said, people can apply for the benefit until August this year.

I ask the Scottish Government to commit to advertising the issue more over the next few months. In the Government’s response to the Social Security Committee, it pointed out that some work is being done by Age Scotland, but no work has been done by the Scottish Government. I make the same plea to the UK Government. Over the remaining weeks and months that we have available, more should be done on advertising so that the take-up rate improves.

It will be interesting to find out why take-up is so low. As we roll out new benefits in Scotland, we need to look at how people take up the benefits to which they are entitled, and at why some people are not doing so.

We need to be careful about the language that we use, so that we do not put fear in people who are already on the benefit. We also need to work carefully to ensure that take-up of the benefit and others is maximised, so that people get what they deserve.

13:19  

I thank Kenny Gibson for a very well-written motion, and I commend him for an excellent speech and for bringing the subject to Parliament. I hope that there is the opportunity for full consensus and cross-party support for what Kenneth Gibson is trying to achieve, and consensus against the Tory policy.

I will go so far as to say that I have not seen a more callous welfare reform; I have not seen a welfare reform proposal that will undermine family life as much as the one that we are debating. I remember when the Labour Government introduced pension credits, along with child tax credits. Gordon Brown introduced those credits to lift thousands of pensioners and families out of poverty. He did so in the full knowledge that there were some such couples in which one partner was of working age. He did it to improve the living standards of those pensioners dramatically, and he was successful in that. As other members have said, to roll back those achievements will push more pensioners into poverty.

We know that the change will affect new claimants, but we also know from experience of the tax credits system that any change to a person’s circumstances means that they are put in the pot of new claimants, so they will lose their pension credit.

Elaine Smith is right: the element that is so scandalous is the unfairness to mixed-age couples. That is an important point on which to concentrate. It must be, at least, indirect discrimination, if not direct discrimination, because women will bear the brunt of the policy change as it tends to be women who are the younger partners. I hope that organisations are already looking at how the change of policy can be challenged.

People have from 14 May until 13 August to submit a claim, if they have not already done so. However, I think that thousands of people will still lose out, so we have a job to do to make people aware of that when they reach pension age and do not have an adequate pension. Inadequate pensions are the root of the problem. Although employers are required to provide a pension these days, some—particularly in the private sector—are absolutely appalling.

Low pay has led to low pensions. A person who retires and has that sharp drop in income will be penalised in every respect if they are part of a mixed-age couple. The change places a much greater burden on the younger partner, who must play the role of the state by providing and making up that income.

It is a heartbreaking policy, and there is no doubt that for couples who have age gaps of 10, 12, 15 or more years, there will be a heavy burden on the younger person and on the relationship. That is why I said that I have not previously seen a policy that undermines family life to the extent that the one that we are debating will.

Members heard the figures from Kenny Gibson. They are real figures—they are not manufactured. It is not just the loss of up to £7,000: we already know about the hardship and trauma that is experienced by people who are forced on to universal credit, which is a system that is far from fit for purpose. I fear for couples in that situation—I deliberately use the word “fear”.

Elaine Smith said that the impact on local economies will be substantial, if we consider how much money will be lost in the future—never mind the substantial impact on the housing crisis that Alasdair Allan mentioned. We face losses of £20.8 million, which will cause a large societal impact.

Do I have four minutes, or five, Presiding Officer?

You have four minutes.

I will finish by saying that it is a heartbreaking policy. Most people have no control over the situation because it has been sprung on them at a time when they cannot even plan to change their family income.

We must stick together on the issue. It is not too late to stop the decision. We have to get out there, argue our case and hope that something can be done. Perhaps the Tories on the other side of chamber might show some compassion for once in their lives, and decide to join us in calling for change.

13:24  

I thank Kenneth Gibson for securing this vital debate. As convener of the Parliament’s Social Security Committee, I am deeply worried by the pension credit changes, which are effectively cuts to some low-income pensioner households.

Some pensioners are being targeted simply because of the age of their partner, which is not right. Concerns about that led our committee to hold an evidence session with Age Scotland and Citizens Advice Scotland, and the evidence that they gave was deeply worrying. It was alarming, but alarm bells should be ringing. The original policy document on the change dates back to 2011 and was produced by the UK Government minister Chris Grayling MP. We should not be surprised that the man who gave ferry contracts to companies without ferries designed a policy to deny pension protections to low-income pensioners.

Adam Stachura from Age Scotland told our committee that the cuts would have a

“devastating impact on the finances of the poorest pensioners”.

He also raised concerns about the impact on passported benefits, as we have heard, such as cold weather payments, council tax reduction and housing benefit. Those who do not rely on passported benefits will lose up to £7,000 a year and those who rely on them could lose £10,000 a year.

This is not an abstract debate but a looming reality for low-income mixed-age couples. Adam Stachura gave this example to our committee:

“I was speaking to a gentleman at a meeting of older people in Glasgow last week, who told me that he was 70 and his wife is 60 and still working. He was the first person whom I had spoken to who was part of a mixed-age couple and on a very low state pension. He did not realise that he might be entitled to pension credit,”

—he was not claiming it—

“so his first step was going to be to call our helpline. Because of the 10-year age gap between him and his wife, and the rise in state pension age”

—WASPI women are affected, as has been mentioned—

“he realised that it could be six or seven years until they could claim pension credit after the policy change.”—[Official Report, Social Security Committee, 7 March 2019; c 4-5.]

That is simply appalling.

Our committee agreed to urgently write to the UK Secretary of State for Work and Pensions, Amber Rudd, raising our concerns and urging that the cuts be scrapped—except, of course, for the Tory members, who did not agree to sign up to the letter. We received a reply from the UK minister for pensions and financial inclusion, Guy Opperman MP. Given the policy intent of what he is proposing, his ministerial title is laughable, but one aspect is accurate—he is the minister for pensions and is certainly not the minister for pensioners, because he is categorically letting them down.

Unsurprisingly, the minister rejected our representations. His reply said:

“It is important to be clear that this is about making sure that all working age people, irrespective of their partner’s age are subject to the same labour market approach”.

What an idiotic thing to say. Fundamentally, he is discriminating against pensioner households. He has distinguished between some low-income pensioner households in poverty and others. He is absolutely wrong-headed and is discriminating against people simply because they love someone who is younger than them.

He also said:

“Pensioners in mixed age couples claiming Universal Credit will not be subject to any work related conditionality rules. However, conditionality for the working age partner will be tailored to meet their specific circumstances, just as it would for any other claimant.”

There we have it: not only will some households be £7,000 worse off, but they will be subject to sanction under universal credit—a double whammy that is simply unacceptable.

On 29 April, our committee wrote back to Guy Opperman asking for a six-month delay, given that 40 per cent of households that are entitled to pension credit do not claim it. Michelle Ballantyne and Jeremy Balfour signed up to that letter—I was disappointed that they did not sign up to rejecting the policy intent, but they signed up to delay the implementation. However, it is only six days until the policy kicks in and we have had no reply. The change is going to happen, unless there is a U-turn by the UK Government.

The final thing to say, other than showing solidarity—

Would Mr Doris, as the convener, agree that I said that I did not care either way whether we sent letters because it was too late, and that he is now saying exactly that? We have not had a response yet. I was quite happy to sign up to the letter on the basis that I thought that there were things that needed to be looked at.

My interpretation is that Michelle Ballantyne agrees with and is defending the changes, which I find appalling. However, I was pleased that she signed up to the letter, even though she was completely indifferent about it.

Ultimately, we are tinkering at the edges of trying to defend the income of impoverished pensioners in our country. There has to be a better way to do this. By God! Can we get power over pensions and benefits to this Parliament? There is no way that we would treat pensioners as appallingly as the Tory Government does.

13:29  

I, too, thank Kenneth Gibson for bringing this important matter to the chamber, and I thank everyone who has taken part in the debate for their contributions.

The UK Government’s decision to change entitlement to pension credit will, like many of its decisions, impact on the poorest and the most vulnerable in our society. In this case, they are paying the price simply for having a younger partner. The change, which, as we have heard, could have a drastic impact on a couple’s finances, is just another example of the UK Government making it more difficult for people to get the support that they need.

We could spend hours talking about the problems with universal credit—indeed, we have done so on many occasions in the chamber. The change in question will force even more people on to a system that is simply not fit for purpose. The issues with universal credit, such as the five-week minimum wait for a first payment and the difficulties that many people have even in receiving the correct payment, are bad enough, but the level of support that people in a couple in which one person is under the state pension age and one is over it will now be entitled to will be even lower. To put it simply, the UK Government has made the decision to give those couples less money to live on. As Alison Johnstone and others have quite rightly pointed out, the UK Government is opening more people up to the discredited sanctions regime.

That is not to mention the fact that, as many have pointed out, the decision was made to announce the commencement of the policy quietly, through a written ministerial statement on the day of the meaningful vote on 14 January. That was just four months before the policy was due to come into effect. At the time, Age UK accused the UK Government of attempting to “bury bad news”. I could not agree more.

Although it can be argued that it is fairer for a person of working age to be subject to the same benefit as everyone else in that position, the loss of pension credit for the pension-age partner is extremely unfair and completely unjust, as are the sanctions regime and many other aspects of universal credit that underpin the benefit system. As Kenneth Gibson and Alison Johnstone have pointed out, universal credit is not designed for those of pension age.

Earlier this year, I wrote to the UK Government and asked to see the impact assessment that had been carried out on the policy. In his response, the UK Government’s Parliamentary Under-Secretary of State for Pensions and Financial Inclusion, Guy Opperman, told me that there was no impact assessment, but the DWP had published some ad hoc statistics. All that those statistics showed was the numbers affected and the money to be saved. There was nothing about the impact on people’s lives.

Mr Opperman also wrote to the chair of the UK Parliament’s Work and Pensions Committee to say that, as the UK Government makes no poverty rates forecasts,

“an assessment of the impact of the mixed age couples changes on poverty has therefore not been made”.

I am very pleased that many members have highlighted the impact that the policy change will have on women in particular, which is a very important aspect. Kenneth Gibson, Gillian Martin, Elaine Smith, Alison Johnstone and many other members have raised that issue. Engender’s briefing for the debate was quite right to point out that the change compounds the issues that affect the WASPI women.

Not long ago, we debated in the chamber the WASPI campaign and the WASPI women’s fight. The debate highlighted once again that the UK Government is denying full state pensions to those women. I repeat what I said that during that debate: it is not the UK Government’s money; it is the WASPI women’s money, and they are absolutely entitled to it. The pension credit changes are yet another unfortunate example of a welfare cut that hits women hardest.

Elaine Smith rightly said that this is not just about personal hardship—difficult though it will be. It is about health and wellbeing, the social isolation that will be created with the pension change, and the important community impacts that it will have. The issue is much wider than the pension credit couples whom we are talking about. There will be a much wider impact, as there has been with many changes to the welfare system.

Alasdair Allan and others have pointed out that the change will have a direct impact on the passported benefits that many people will be entitled to. For people who rely on passported benefits, the cut from the pension credit change will be even more severe. Again, that shows that many different aspects will affect many people in different ways.

The other important aspect that has been drawn out by many members is that those who are on pension credit at the moment are not safe. If they have one change of circumstance and tell the DWP, they will also lose out. That puts those who are on pension credit at the moment in fear of losing their entitlements in the future.

I return to an aspect of pension credit that Michelle Ballantyne, Jeremy Balfour and others spoke about, which is encouraging people to sign up for pension credit. I could not agree more. What a shame that the UK Government has never taken that seriously. When Jeremy Balfour talks about the fact—-

What have you done? You have done nothing at all.

I will get on to that. If Mr Balfour gives me a minute, I will get onto what the Scottish Government is doing to pick up the pieces where the UK Government has failed.

The UK Government does not encourage take-up of benefits as we are committed to do under the Scottish social security system. Where is the UK Government uptake campaign to support those who will be affected by the change? With the greatest respect to the audience that is listening and watching online today, let us not rely on a member’s debate in the Scottish Parliament to encourage uptake. Where is the UK Government’s campaign to encourage uptake of pension credit, which has one of the lowest uptake rates?

I will talk specifically about what the Scottish Government action has been. Back in 2017, my predecessor, Jeane Freeman, announced an awareness-raising campaign for people who were not applying for pension credit because they were unaware of it. There was a concerted effort then, which included radio and press advertisements. We are currently taking action to maximise the incomes of older people and those who are set to retire, particularly those who will be affected by the UK Government pension credit policy. We are supporting older people through our financial health check service, which offers free personalised advice on money matters to help people to maximise their incomes and reduce the poverty premium that means that they pay more for basic goods and services. It provides advice on subjects ranging from benefit uptake and council tax reduction to the reduction of utility bills and other household costs.

Once again, the Scottish Government is delivering for Scottish pensioners where they have been failed by the UK Government. Once again, we have a stark example of the ways in which the UK benefits system is not fit for purpose. However, those who do not want the powers to be devolved to this Parliament are calling for this Parliament and Government to pick up the pieces of a failed UK system.

I fully support Mr Gibson and the motion and I join members, once again, in calling for the UK Government to reconsider the changes to pension credit.

13:37 Meeting suspended.  

14:30 On resuming—