§ 7. Miss Anne McIntosh (Vale of York)What recent representations he has received on his policy in respect of early retirement by the over-50s. [124951]
§ The Secretary of State for Social Security (Mr. Alistair Darling)We have received a number of representations. We have no problem with people who choose to retire early as long as they can support themselves. The problem today is that too many have retired early because they were compelled to do so and half of those over 50 who have retired early rely on benefit. That is a situation that no Government can allow to continue.
§ Miss McIntoshWill the Secretary of State allow people to continue to contribute to occupational pension schemes as well as to his stakeholder scheme? Does he accept that by raising, or threatening to raise, the age at which a person can draw an occupational pension from 50 to 55, he is taking away the very flexibility and stability that have encouraged people to contribute to such pension schemes in the past?
§ Mr. DarlingI agree with the hon. Lady; I do not want to take away any incentives or flexibility. We want people to take up occupational pensions and to continue to do so and we want people to take up stakeholder pensions. The problem is not those people retiring over the age of 50 who can afford to do so, but the fact that a growing number of people have been put out of work—usually because they have been persuaded or forced to—who cannot afford to support themselves. A lot of those people rely on benefits to make up their income. No responsible Government can allow that to continue.
We will not make any changes to the pensions system without consultation or without giving adequate notice. Also, we will make no apology for the fact that we want to do far more to ensure that those over 50 who do not want to leave work or cannot afford to do so get the opportunity to stay in work. That is why we have introduced the new deal and a variety of other measures to encourage them to do so.
§ Mr. Dennis Skinner (Bolsover)Why not call a spade a spade? In my constituency, and nearly every coalfield constituency, we have probably 2,000, 3,000 or 4,000 people unemployed who were sacked by the Tories because they worked in coal mines at the time. Every single one of them did not want to go on benefit. They all wanted a job and would have loved the pits to stay open. The same is true of shipbuilding and steel areas. All of those people who were chucked on the scrap heap by the Tory Government in those 18 miserable years would love to be in work. That is the real reason why many of them cannot get a job. The sad fact is that, in constituencies such as mine, the percentage of unemployment is still in double figures and the chances of getting a job are remote until we can rebuild to make jobs available. But for God's sake, let us put the blame where it lies—it was the Tories who caused havoc.
§ Mr. DarlingMy hon. Friend is quite right. People will not forget that, up and down the country, large numbers lost their jobs in the 1980s and early 1990s and were left 12 high and dry by the Tory Government. Those who were not left in the dole queue were transferred to the sick list in an attempt by the last Government to hide what was happening. Unlike the Tories, this Government are helping older people by ensuring that we have the right economic conditions to create more employment. There are now nearly 1 million more jobs in the economy than there were. Also, specific measures such as the new deal help people to get back to work. These and other measures would all be abolished by the Conservatives were they ever to get back into government. They would return this country to the division and unfairness in society that we had during their 18 years.
§ Mr. John Bercow (Buckingham)The savings ratio has halved in the first three years of this Government, pension funds have been clobbered with additional taxation and the average 30-year-old will be required to pay an extra £200 a year into his or her pension to prevent its value being depleted on retirement. Given all that, by exactly how large a figure does the Secretary of State anticipate that the number of people able to afford to retire at 50 will fall in the lifetime of this Government?
§ Mr. DarlingAs I told the hon. Member for Vale of York (Miss McIntosh), I have no problem with people retiring at 50, as long as they can afford to do so. The problem that we inherited from the previous Government was that far too many people over 50 retired who have had to rely on benefits as a result. The pension changes that we have made will ensure that people who have worked for a lifetime will be able to retire on an adequate income.
The hon. Gentleman will also want to bear in mind the fact that the stable economic conditions that the Government have built, and our changes to corporation tax that allow companies to retain more profits, are of benefit to pension funds. They create a far more stable and benign environment for pensioners than anything that the previous Government achieved.
§ Mr. David Drew (Stroud)Does my right hon. Friend agree that the real costs of early retirement are starting to come home to roost? Interestingly, the move toward early retirement peaked in 1997. Should not the Government launch an inquiry into the true economic, social and personal costs of early retirement?
§ Mr. DarlingMy hon. Friend is right. There is an economic cost to the policies left by the previous Government. It costs between £3 billion and £5 billion a year to have people not paying tax but drawing benefits. My hon. Friend mentioned an inquiry: the country held an inquiry into such matters three years ago—and threw the Tories out.