HC Deb 26 January 1998 vol 305 cc9-10
8. Ms Dari Taylor

What plans she has to increase the pension entitlement of women. [23059]

Mr. Denham

One of the major challenges facing the pensions review announced by my right hon. Friend the Secretary of State in July 1997 is to narrow the pensions gap between men and women, to give women more security in retirement. Many pensions are simply not flexible enough to cope with women's working patterns and the fact that they earn less on average than men and are more likely to have caring responsibilities. We are committed to introducing pension sharing for divorcing couples from April 2000. Our proposals for citizenship and stakeholder pensions will be of particular benefit to women.

Ms Taylor

I am grateful to my hon. Friend for that reply. Does he agree that low pay and the earnings limit on contributory benefits have a serious impact on pensions? Does he therefore agree that the introduction of a statutory minimum wage will be very beneficial? Would he consider studying the idea of relaxing or abolishing the earnings limit on contributory benefits?

Mr. Denham

Measures such as the minimum wage, which enable women to earn more, will obviously help them to develop better pension rights, as will measures such as our proposed stakeholder pensions, which will bring within their reach value-for-money, flexible and secure pensions. My right hon. Friend the Chancellor indicated some of the areas that he was studying in relation to national insurance and contributions limits, and will make proposals in due course.

Miss McIntosh

May I say how nice it is to see the Minister for Women in the House today and, through you, Madam Speaker, ask her whether she has had a chance to consider the impact of the reforms that the Government wish to make, by abolishing the independent taxation of women, on women's pension entitlement?

Mr. Denham

I believe that I am answering the question, Madam Speaker. I think the answer to that is—[Interruption.] The pensions review is considering a wide range of issues. One of the challenges that we set ourselves in establishing the pensions review was the much-needed one of narrowing the pensions gap between men and women, so we shall be considering many of the obstacles that currently prevent women from developing good pension rights.

Mr. Wicks

Perhaps I could ask the Minister for men a question. Given that many women in their working lives become carers of elderly relatives or perhaps of a frail husband, and as a consequence suffer the penalty of poverty in old age because of loss of pension entitlements, will the Government make provision in their plans to ensure that we have decent and generous credits for those in the community who, by doing vital work—although not in the waged economy—save the country billions of pounds?

Mr. Denham

My hon. Friend makes a very important point. Although we obviously want to encourage as many people as possible to develop a value-for-money, funded, invested second pension, obviously some people are unable to do so as they are exercising caring responsibilities and are not in a position to contribute. In the pensions review, we are examining proposals for a citizenship pension, with the aim of ensuring that people who spend a large part of their lifetime caring do not end up in retirement on means-tested benefits, which is a poor reward for the service that they have given to their families and the wider community.