HC Deb 09 February 1982 vol 17 cc848-9
9. Mr. McCrindle

asked the Secretary of State for Social Services whether he will publish a consultative paper setting out ways in which a flexible retirement system could be introduced.

Mrs. Chalker

My hon. Friend will be aware that the Select Committee on Social Services is currently studying the age of retirement. The evidence given by the Department to the Committee, which has recently been published, sets out our position on the subject. In the light of the Committee's report, which should be published later this year, we shall consider how best we can move towards the long-term objective of introducing greater flexibility of retirement.

Mr. McCrindle

Does my hon. Friend agree that, although the idea of flexible retirement is attractive, it is also likely to be particularly expensive? Will she confirm that, in considering the possibility of moving towards flexible retirement dates, she will weigh in the balance the respective advantages of increasing the basic rates of pension? Finally, will she have consultations with the private pensions industry, which may feel that it has to move in line with the Government, in which case only the contributors are available to pay?

Mrs. Chalker

I understand my hon. Friend's concern, not only with the cost of moving to a system of flexible retirement, but with the interim costs associated with increasing the basic rates of pension in line with inflation and faster than the index of prices. I assure my hon. Friend that in all our discussions, when we have received the report from the Select Committee, we shall take close account of what the private pensions industry says. However, at this stage I cannot presage the future basic rates of pension, except to say that of course they will be kept at least in line with prices.

Mr. Newens

As so many people are unemployed, might it not make good sense to enable those in later middle age who are in ill health to retire, so that they can enjoy the years that they have left and so that others may have an opportunity to take worthwhile jobs?

Mrs. Chalker

I understand the hon. Gentleman's concern, bul: he knows that an overall reduction in the pension age would be very costly. He spoke about those in ill health who would appreciate early retirement. Such retirement is possible in many cases through the job release scheme. Those who have been unable to continue in employment, who have spent more than a year on supplementary benefit and who are aged over 60 can now deregister and receive the long-term rate. I understand full well the hon. Gentleman's point about those in ill health, but avenues are opening all the time to the possibility of early retirement.

Mr. Forman

Is my hon. Friend aware that her original answer will prove encouraging? What prospect is there of expanding the job release scheme?

Mrs. Chalker

That is a question for my right hon. Friend the Secretary of State for Employment and I shall draw it to his attention.

Mr. Hardy

Does the Minister accept that in areas of high unemployment thousands and thousands of men in their early sixties long to retire—in some cases are desperately eager to do so—and that at the same time there are also those in their forties and fifties who have recently been made redundant and who fear that they will never again have an opportunity of employment?

Mrs. Chalker

We shall bear the hon. Gentleman's remarks in mind. The evidence given to the Select Committee and the responses made to the Government's White Paper "Growing Older" are very much in our minds. However, to take any immediate action, such as a reduction of the male pension age to 60, would cost about£2,500 million per annum. Such costs cannot readily be entertained at present.