Monday, 1 February 2016

What they really want

As Henry Tapper puts it, today is WASPI day. Today is the day that "Women Against State Pension Inequality" get the Westminster debate for which they have campaigned.

Eh, wait? Wasn't there a debate on this back in early January?

Yes, there was. It was a backbench motion proposed by the SNP MP Mhairi Black. It called on the government to re-examine the acceleration of the equalisation of women's and men's pension ages in the 2011 Pensions Act, which added up to 18 months to the state pension age of some women born in the 1950s:
That this House, while welcoming the equalisation of the state pension age, is concerned that the acceleration of that equalisation directly discriminates against women born on or after 6 April 1951, leaving women with only a few years to make alternative arrangements, adversely affecting their retirement plans and causing undue hardship; regrets that the Government has failed to address a lifetime of low pay and inequality faced by many women; and calls on the Government to immediately introduce transitional arrangements for those women negatively affected by that equalisation.
The motion was carried by 158 votes to zero, a remarkable achievement for Black, the youngest MP in the House of Commons. But the Government is not bound to take any notice of it, and so far has declined to do so.

And it wasn't what WASPI wanted anyway. They are not really interested in the 2011 change. Their aim is much larger: payment in lieu of pension at 60 for all women born between April 1951 and December 1959 whose pension age has risen as a consequence of the 1995 and 2011 Pension Acts. This is why they continued to drum up support for their petition even after Mhairi Black's motion was carried unanimously.

On Monday last week, in an interview on BBC2's Victoria Derbyshire show, one of the WASPI women, Wendy Eachus, made a heartfelt case for the state pension to be paid from her 60th birthday.  She described how her dream of stopping work and visiting her family in Australia and Canada had been shattered. In her words: "I wanted to do some travelling and enjoy life a bit while I'm still fit enough to do so".

The following day, Simon Read, in the Independent, wrote a sensible piece particularly highlighting the plight of women affected by the 2011 change and women born 1951-3 who will not qualify for the new State Pension. He featured Wendy's interview.

But there's a problem. Wendy Eachus was born in 1956. She is not one of those affected by the 2011 change. And when she reaches her state pension age in 2022, she will receive the new State Pension. Simon Read's piece is not about her. It just shows how confused the whole subject is that a good journalist like Simon Read managed to miss this.

By choosing Wendy Eachus to front this interview, WASPI shot themselves in the foot. They inadvertently revealed their real aim on mainstream media. No more could they pretend that this was about "fair transitional arrangements" for those caught by the 2011 change. No, it is all about the 1995 equalisation of mens' and womens' pension ages, which affects younger women more than older ones. Wendy herself made it clear that she wants the pension at 60 to which she believes she is entitled.

In her briefing to today's debate, the Pensions Minister, Ros Altmann, summarises the WASPI demand thus:
The Debate is about the WASPI petition, claiming to call for ‘transitional arrangements’ for 1950s women whose state pension age has increased from age 60. These so-called ‘transitional arrangements’ actually call for all 1950s women to be paid their state pension from age 60. They are effectively and unequivocally asking Government to reverse the women’s pension age changes of the 1995 Pensions Act not just the 2011 Pension Act. This would give thousands of pounds to each of these women. 
It is fair to say that this aim is not clearly expressed in the petition, which simply calls for "fair transitional arrangements" for women born in the 1950s:


But it is pretty clearly stated on their Facebook page:


More importantly, it was explicitly stated by Anne Keen, one of the co-founders, in her verbal evidence to the Work and Pensions Committee:
"Basically, what we are asking – and we feel this is a very fair ask – is for the Government to put all women in their 50s born on or after 6 April 1951 and affected by the state pension age in exactly the same position they would have been in had they been born on or before 5 April 1950.  …all our lives we expected to receive our pension when we were 60...Although there was not a written contract as such there was a psychological contract."
Ros Altmann appears to be correct. Putting all 1950s women into the financial position that they would have been in had they been able to claim their state pension on their 60th birthday, as women born prior to 5 April 1950 did, is equivalent to rolling back the state pension rises in the 1995 and 2011 Pension Acts.

But WASPI have repeatedly denied that this is the correct interpretation. They claim to support equalisation of womens' and mens' pension ages. They insist that the issue is inadequate notice, and that the demand is for "fair transitional arrangements", not repeal of the 1995 and 2011 Pension Acts. And they've convinced a lot of people. Over 135,000 have signed the petition.

The 1995 Act included transitional arrangements. It delayed the start of the equalisation by 15 years so that women had adequate time to prepare. And it provided for women's pension age then to be raised gradually over the course of 10 years, from 2010-20. All women born prior to April 1950 would retire on their 60th birthdays, but for those born from April 1950 to March 1955 the SPA would rise by one month in two. All women born from April 1955 onwards would retire at 65.

The 2011 Act accelerated the 1995 change for women born 1953-4, and added an extra year for those born September 1954 onwards. They will now retire at 66, not 65. Wendy Eachus was sent a letter about this change. The trouble was, she didn't know about the 1995 change, because DWP communication was - to put it mildly - inconsistent. So to her, this letter told her not about a 1-year increase, but about a 6-year one.

The DWP says that "all women were written to". This is now true for 1950s women, though not yet for younger ones: most women born in the 1960s and 70s, whose pension age was 60 when they started work, still have not been written to about the rises. But the DWP's statement misses the WASPI point about notice. Receiving a letter telling you that your state pension age has effectively risen by six years when you are less than two years from the state pension age that you expected is a terrible shock, and for some women will have caused financial as well as emotional distress. It is unfair to blame women for DWP communication cock-ups.

WASPI argue that the 1995 transitional arrangement was "unfair" because it was not properly communicated.  In response to this, WASPI are demanding not the repeal of the 1995 Act, but the elimination of the transitional arrangements put in place in 1995 and amended in 2011. Would this create "fair transitional arrangements"?

If the WASPI demand were met in full, all 1950s-born women would in effect receive their pensions as if entitled to them on their 60th birthday. No doubt they would regard this as "fair". But women born in 1960 would not receive them until their 66th birthday. So a woman born on 31st December 1959 would receive the equivalent of six years' more state pension than her classmate born 1st January 1960.

The original transitional arrangements were designed to prevent severe cliff edges like this: even the 2011 acceleration did not create anything as sharp as this. The cliff edge that the WASPI demand would create if met in full is clearly shown on this chart from Suzy Allbright:


The truth is that the WASPI demand is not for "fair transitional arrangements". It is for NO transitional arrangements. And it is grossly unfair to women born in early 1960, who would not only receive six years' less pension than their classmates but would have to pay higher NICs and taxes to fund the extra payments to their peers. So WASPI want to stiff their younger sisters. Nice.

What about the WASPI claim that they support equalisation of state pension ages? Indeed they do - for the same group of slightly younger women. Under the WASPI plan, a woman born 1st January 1960 would receive her state pension at the same age as her male classmate born the same day. But a woman born 31st December 1959 would effectively receive her state pension SIX YEARS earlier than a man born the same day. So WASPI support equalisation, but for their younger sisters, not for themselves.

As Ros Altmann puts it in her briefing to the debate today, "They call their campaign ‘Women Against State Pension Inequality’, but its demands could perhaps be more accurately described as ‘Women Advocating State Pension Inequality’ ".

It is abundantly clear that rolling back state pension entitlements cannot happen, not least because it is horrendously expensive. The estimated cost of effectively restoring state pension at 60 for 3.7m women born in the 1950s exceeds £100bn, and could be double that if EU equality law means that the same payments have to be made to 1950s-born men as well. However angry women are about lack of notice, it is very hard to see how such indiscriminate payments irrespective of need and regardless of the cost to younger women and men can possibly be justified.

But that does not mean that the needs of those who face hardship because of these changes should be forgotten. Few people would disagree that the DWP should act to relieve distress caused by their communication failures. The question is what form that relief should take. Personally I think this should take the form of adjustments to working-age benefits - for example, removing jobsearch conditionality and sanctions for women and men over 60 who are claiming JSA and ESA, and relaxing the taper so that they can keep more of their savings.

When the WASPI campaign fails, as it inevitably must, it is important that this debate keeps going.


UPDATE. Since there seems to be quite a lot of confusion about the effects of the 1995 change and the 2011 acceleration, I am posting here a handy guide to retirement ages, courtesy of Ros Altmann.



Please note that I will not provide links to the WASPI petition or any WASPI source material. I will also remove any such links added in the comments. 


Related reading:


The angry WASPIs

Here I stand, I can do no other

25 comments:

  1. The obvious way round is to do something about means-tested Pension Credit. Because of EU equality laws, this applies to men and women from the current female state pension age.

    There's nothing other than money preventing detaching the pension credit age from the state pension age. However, it's means-tested so that isn't what the petitioners want.

    But, unlike JSA or ESA (both means-tested from 6 months for JSA and 12 months for ESA) it doesn't have conditionality (yet).

    Maybe worth remembering that conditionality for JSA claimants aged over *50* ramped up from 2006 - up to then programme participation was voluntary.

    ReplyDelete
  2. We have paid NI contributions - most of us have worked since we were 15/16 and have more than sufficient contribution years to qualify for our pension at 60. I wasn't notified back in the 1990's - neither were a lot of women. Most women, like myself, didn't have jobs that paid enough to be able to invest in a private pension. As to funding the payment - is it realistic to foot the bill to repair Westminster Palace - UK taxpayer could face £7 billion bill for Palace of Westminster repairs - when it would make far more sense to move Parliament to Central Britain. A new building would cost a fraction of this repair bill and would reduce the need for second homes and travelling expenses by many MP's not based in the South of England.

    ReplyDelete
    Replies
    1. Unknown,

      the number of years' contributions has no bearing on the age of entitlement. From April I will need 35 years contributions to qualify for a full SP. But that doesn't mean that I can claim my pension at 56 because I started work at 21.

      Nor do private pensions have any bearing on this. This is about entitlement to state pension.

      £7bn is not going to make much of a dent in over £100bn.

      Delete
  3. It appears to me that even the author or the above doesn't know how the fast tracking affected SPA:
    The 2011 Act accelerated the 1995 change and added an extra year for those born April 1955 onwards. They will now retire at 66, not 65.
    I was born August 54 and can now expect to retire at 66 in 2020. To add insult to injury, girls in the same year at school, will reach SPA nearly 3 years before me. Is this fair?

    ReplyDelete
    Replies
    1. I do know, actually. I have repeatedly said I think the 2011 acceleration was unfair to women born in 53-4. But that was not the point of this post.

      And I remind you that WASPI apparently think it fair that women born in January 1960 retire SIX YEARS later than their classmates born in December 1959. Do you have nothing to say about this?

      Delete
    2. I have updated the post with a table of retirement ages courtesy of the Pensions Minister. As far as I can see you reach SPA at 65 & 11 months, not 66. But I agree that is a minor difference. More seriously, why do you think girls in the same year reach SPA "nearly 3 years" before you? According to this table, the difference is less than 18 months.

      Delete
    3. To be as fair as I can manage, a woman eleven months older than 'Unknown' will reach pension age a full 28 months before she does - 17 months (as per Altmann's table) plus 11 months' age difference. But there's not a lot anyone can do about that.

      Delete
  4. Our group Protest Against the Accelerated State Pension age rise has campaigned all along to revert to the 1995 law, maybe some women didn't know about it but we couldn't expect a 20 year old law to be changed. The rolling scale timetable set out in 1995 to equalise womens state pension age with mens was fairly worked out. The 2011 accelerated age rise was rushed though at too short notice, is unfair, unjust and discriminating, it hits women born 1953/1954 the hardest.

    ReplyDelete
  5. I contribute to the forums on the the moneysavingexpert site and most of the posters making comments are against the WASPI campaign. They highlight that WASPI may actually be doing more damage than good by putting the focus on 1995 and taking it away from 2011. Most feel that the 1995 changes had plenty of time but the 2011 changes were too short. The WASPI campaign turns the 2011 issue into a small side show when instead it should be the key issue being debated.

    ReplyDelete
    Replies
    1. Yes I agree too! Ask too much get nothing! The women and men in our group would be happy to get the up to 18 months extra for women and the up to a year extra for men removed, by reverting to the 1995 rolling scale age rise. That would be very fair.

      Delete
  6. Under the 1995 State Pension Law
    Date of Birth State Pension Age Was


    6/4/53 – 5/5/53 6/5/16
    6/5/53 – 5/6/53 6/7/16
    6/6/53 – 5/7/53 6/9/16
    6/7/53 – 5/8/53 6/11/16
    6/8/53 – 5/9/53 6/1/17
    6/9/53 – 5/10/53 6/3/17
    6/10/53 – 5/11/53 6/5/17
    6/11/53 – 5/12/53 6/7/17
    6/12/53 – 5/1/54 6/9/17
    6/1/54 – 5/2/54 6/11/17
    6/2/54 – 5/3/54 6/1/18
    6/3/54 – 5/4/54 6/3/18
    6/4/54 – 5/5/54 6/5/18
    6/5/54 – 5/6/54 6/7/18
    6/6/54 – 5/7/54 6/9/18
    6/7/54 – 5/8/54 6/11/18
    6/8/54 – 5/9/54 6/1/19
    6/9/54 – 5/10/54 6/3/19
    6/10/54 – 5/11/54 6/5/19
    6/11/54 – 5/12/54 6/7/19
    6/12/54 – 5/1/55 6/9/19
    6/1/55 – 5/2/55 6/11/19
    6/2/55 – 5/3/55 6/1/20
    6/3/55 – 5/4/55 6/3/20
    6/4/55 – 6/4/68 65th Birthday

    ReplyDelete
  7. Under the 2011 State Pension Law
    Date of Birth State Pension Age Is Now


    6/4/53 – 5/5/53 6/7/16
    6/5/53 – 5/6/53 6/11/16
    6/6/53 – 5/7/53 6/3/17
    6/7/53 – 5/8/53 6/7/17
    6/8/53 – 5/9/53 6/11/17
    6/9/53 – 5/10/53 6/3/18
    6/10/53 – 5/11/53 6/7/18
    6/11/53 – 5/12/53 6/11/18
    6/12/53 – 5/1/54 6/3/19
    6/1/54 – 5/2/54 6/5/19
    6/2/54 – 5/3/54 6/7/19
    6/3/54 – 5/4/54 6/9/19
    6/4/54 – 5/5/54 6/11/19
    6/5/54 – 5/6/54 6/1/20
    6/6/54 – 5/7/54 6/3/20
    6/7/54 – 5/8/54 6/5/20
    6/8/54 – 5/9/54 6/7/20
    6/9/54 – 5/10/54 6/9/20
    6/10/54 – 5/11/54 6/10/20
    6/11/54 – 5/12/54 6/11/20
    6/12/54 – 5/1/55 6/12/20
    6/1/55 – 5/2/55 6/1/21
    6/2/55 – 5/3/55 6/2/21
    6/3/55 – 5/4/55 6/3/21
    6/4/55 – 6/4/68 66th Birthday

    ReplyDelete
  8. Women born April 1954 to work more than 3 years longer than women born April 1953 Very badly worked out, unfair, unjust and discriminating

    ReplyDelete
  9. Quote ....'The question is what form that relief should take. Personally I think this should take the form of adjustments to working-age benefits - for example, removing jobsearch conditionality and sanctions for women and men over 60 who are claiming JSA and ESA, and relaxing the taper so that they can keep more of their savings' .......How very unfair that would be, there are women dragging themselves to work who are far less fit than some on the sick, they have worked all their lives from 15 years of age and are looked upon as work horses! Also I know someone who was told that people who have worked are targeted more to keep on working than those on jsa who don't want to work. So why reward them rather than the ones who have always worked and don't want to beg for benefits? Also 'keep more of their savings' many women alone have no savings!!!! Equality of wages and the chance of saving for a private pension came too late for them.

    ReplyDelete
  10. NO NO NO to this! "But that does not mean that the needs of those who face hardship because of these changes should be forgotten. Few people would disagree that the DWP should act to relieve distress caused by their communication failures. The question is what form that relief should take. Personally I think this should take the form of adjustments to working-age benefits - for example, removing jobsearch conditionality and sanctions for women and men over 60 who are claiming JSA and ESA, and relaxing the taper so that they can keep more of their savings." How can that be fair that people not working should get these concessions while people like me, and there are a lot of us, are struggling to go to work to support ourselves because we have no choice! I'm a widow of almost 62, have no other means of support than what I go out and earn and to do that I take anti-inflammatories prescribed by my GP, osteoarthritis in neck, hands, knees and feet make it hard and painful to earn my living and I deserve a concession as much as those who have gone on the sick or taken early retirement do. Part of the protest against the SPA rise is that it is discriminatory, well so is this proposal, it discriminates against people who are struggling on and favours those who have given up!!

    ReplyDelete
    Replies
    1. One possible other solution si to widen the definition of 'work' and offer a living wage job to all fitte dto the person:

      http://www.3spoken.co.uk/2015/11/job-guarantee-jobs-for-people.html

      Delete
    2. How does offering jobs to people who don't want to work solve the problem?

      Basic income is a MUCH better solution.

      Delete
    3. "How does offering jobs to people who don't want to work solve the problem?

      Basic income is a MUCH better solution."

      It solves the political problem - aka "cut benefits on the scroungers"

      Basically it's politically untenable and stops anything going forward.

      Retirement is always a current production issue. There is no retirement without support from workers. They may have "saved" money. They didn't save bread. Money only buys bread if there is any spare :D

      Also the current generation is skimping on investment and thus are not earning retirement.

      Government needs to support UK workers - not elderly, not "refugees" - workers.

      Delete
    4. You aren't actually discussing the topic of this post at all.

      Delete
    5. Well good luck WASPIs. Sorry I gave any advice!

      Delete
    6. The DWP is in such a shambles I don't think even they know what they are doing. I contacted them around 2009, when expecting to retire in 2013 (b.Sep't 1953) I was given a retirement date for Nov.2015 - just over 2 years longer to work. In January 2012 I received a letter from DWP stating my retirement date was now March 2018, a further jump of 2+ years. So the 2011 Act raised my SPA far more than the 18months the Gov't keep sprouting. We have been given contradictory information even when it has been forthcoming. Further to this, the DWP website-until 2 days ago, still had womens SPA at 60yrs. They've been preparing for this since 1995!! How on earth with wrong information & little communication can anyone plan.

      Delete
    7. The DWP website did not have a page stating women's SPA at 60 years until this week. An obsolete page on the Government Gateway server, with no active link from any government site (including GG) did - the giveaway clue was the lack of any font formatting.

      If you went to Government Gateway the active service links page did not include a date for SPA, just the link for a pension forecast.

      There has been a Government website with information on the 1995 SPA changes since at least 1998, and the DSS leaflet dates to June 1995.

      Delete
  11. How sad I am that you still find it necessary to continue your commentating on the @WASPI_Campaign Frances. You appear to have taken this up as your own personal crusade to prove them wrong.

    You know that the campaign was started by 5 ordinary women who felt passionate about the injustice being done to themselves and this cohort of women. They have, of course, been on a steep learning curve and I'm sure they have made mistakes along the way, as we all do. They are not experts.

    That they have put their lives on hold to bring this issue into the light and are determined to get justice, is to be commended.

    That 1950's women who had a lifetime of discrimination and inequality; in employment, with pensions, etc should be treated in this way by governments, is unforgivable. That many of us are engage/d in Kinship caring and saving the government a small fortune because of this, is rarely mentioned by commentators either.

    Frances I can understand some of your strength of feeling because, as a woman born in 1960 you will suffer a steep rise too and possibly you have still not had DWP notification of this, but this is NOT the #WASPI women's fault, it is the DWP's

    I believe WASPI have actually done a great service in pursuing this injustice because it has also helped to highlight the issues and inequalities about the New State Pension too and that is to be welcomed.

    It is hoped that the government/DWP will have learnt from the experience of this cohort of women. I know that WASPI have given the select committee their thoughts about how this kind of thing could be avoided from now on.

    I fear we are heading for another fall in the future ( not talking WASPI now) with the pensions pot freedoms !

    ReplyDelete