Pensions Bill

Provoked by the noble Baroness, I am happily willing to support these amendments. The noble Baroness is right. I spent a lot of time in the previous two Parliaments in another place looking at the whole area of disregards, not merely those targeted at and connected with pension credit. However, pension credit disregards have some specific problems. Apart from anything else, the upratings that the noble Baroness suggests would be not as expensive as if disregards were to be addressed across the whole system. The thing that the Government always slip out from under is the charge as to why earnings disregards have never been uprated since 1988. When income support came in the IS disregard was £4. All this time later, we are talking about £5. It seems strange that there is no recognition of the fact that over that period of time, leaving the amount of disregard at that level is bound to have an effect on people’s incentives to go out and get a little job, particularly for those of the age group to whom this amendment relates. Ministers have discretion on this. It is understood that there is no statutory requirement. This amendment seeks to do that, which is right. The Committee would be well advised to give it serious consideration in the context of this debate right now. If there is no willingness to give statutory uprating, why on Earth are the Government not able from time to time to use discretion unless the policy, unstated, is to let it wither on the vine? That is strange for a number of reasons, including equity. If the Government are trying to encourage people to work for longer, certainly that would work with the grain of that important new policy, which the House would support because it is an integral part of the rest of this Bill. If we are to extend the age at which people claim their basic state pension, try to get people working and into the labour market, and be more active, it would be much more realistic to accept something along the lines of this amendment to promote that method of proceeding. I absolutely agree with the noble Baroness: people who do some of this work do not declare it. They would be stone mad if they did because it would prejudice their entitlement to benefits, which would get looked at again. It is a risk. No one defends the non-reporting of benefits, but it is a natural reaction if you are doing a little part-time job, involving a little bit of work helping someone in the village or down the road. I am sure that a big element of the grey economy comes from that direction simply because these limits have not been lifted for so long. We are trying to get more people into work. The Government have quite ambitious targets for the working-age population to get more people into work. It would not be competent to do this at length in this debate, but the whole area of disregards needs to be attended to in the fullness of time. On the face of it, going from £5 to £20 in one go looks like quite an ambitious jump. However, if you valorised the£4 from 1988 up to 2007, you probably would not get far away from the figures that the noble Baroness suggests in this amendment. There is equity in this subject. I am sure that both Houses of Parliament should have turned to it before now. In the context of a pension credit claim and disregard, it is particularly apposite to this Bill and debate. I cannot see for the life of me why the Government do not at least say, ““Well, we will do one of two things. Either we will be sensible and use some discretion from time to time, and every three or five years give this a boost to keep it current and in kilter with what it was in 1988, or take the offer made in this amendment””, which I support. There is a lot of logic to it. It is better because it puts a duty on Ministers, in a statutory framework with which we are all familiar for all other benefits of this kind, to uprate it as part and parcel of the annual statutory uprating process. This amendment is irresistible and I would take an awful lot of persuading that the Government do not need to do something about this urgently.