The hon. Gentleman raises an interesting point. Of course, that was the basis on which the Cridland review undertook its exercise of looking at how to address an ageing population, so he is right that the Government need to look at that issue.
Turning to employer schemes, we have seen a change in the schemes over the years from more beneficial schemes such as the defined-benefit schemes, first from final salary to career-average earnings schemes. There has also been a rapid move to defined-contribution schemes, where more risk is placed with the worker. Therefore, people’s lack of engagement in the complex world of pensions is ever more understandable. Of course, auto-enrolment in some of the pension schemes shows insufficiency, which the hon. Member for Delyn drew out, but the employer contribution of just 3% is hardly that of an employer investing in their workers’
future. I would urge, if we are looking at raising the sufficiency of stakeholder schemes, a greater employer contribution into those schemes, as opposed to the burden being placed on the workers’ shoulders.
I would also like the Minister to look at the number of pension schemes. Many countries have just a few hundred pension schemes altogether; we have more than 10,000, and we know that many of those schemes are struggling. I have looked at the charity sector, where, among the top 50 charities, there is now a deficit of £1.5 billion. We know that in other sectors, people move from job to job to job and therefore have no time to build up a pension pot with a company. If we moved to a more sectoral model, that would give individuals a lot more scope to build a pension for their future, and a model of sectoral bargaining could shape such pension schemes. I think it would be helpful to look into that.
As I have mentioned, equality needs to be brought to the fore, not least because of the impact in terms of women in poverty in later life. Economic events impact on pensions so much. We therefore need to address those issues, but we also need to recognise that in later life, people from areas of deprivation are more likely to be in poor health and so working longer is not always relevant. We need more flexibility to be built into pensions in later life, but we also need to ensure that individuals do not lose out because they work in different ways.
I echo the support that has been expressed for more financial education. I, too, was at the event that Aviva held on work, wealth and wellbeing. It was particularly about people having an MOT to check on them—to check their mental health as well as their physical health—and to look in mid-life at the opportunities and the finances ahead. We need to ensure that such opportunities are open to everyone.
Finally, I want to draw attention to the importance of building confidence again in the pensions system. At a time when people have so little dispensable resource, they will be making choices about whether to invest in their longer-term future or to buy essentials, such as a meal for their family. We therefore need to ensure that we address the poverty today as well as the poverty tomorrow. The WASPI women are one example of a group that certainly made the right choices, yet was badly let down by the changes brought about by Government decisions. We need to build confidence in our system to ensure that there are fair choices for people in the future.
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