Pensions, the triple lock and Scottish Independence

Steve Webb has come under a bit of fire for comments that his triple lock, which guarantees a state pension rise by the higher of earnings, inflation or 2.5%. Let's look at what he actually said to the Financial Times.

My view is it should be triple lock; to be absolutely clear, I would want to see that continue. But we, as a party, will have to thrash that one out.

He made clear that this would be something that all parties would have go deal with.

This is pretty much a statement of the obvious. Every policy of a previous government is up for grabs once the next lot come in.

The triple lock, of course, was brought in when the pension was much lower. It was £97.65 per week  in 2010-11. Sustaining it over the longer term with a pension rate of £142 per week which will be brought in by the Pensions Bill currently going through Parliament  is bound to present challenges. We will need to be quite clear about how we would pay for it. Steve clearly thinks that we should and will no doubt argue his case with the Manifesto Working Group which is currently developing the platform for 2015.

I have long said that it is ridiculous that a family with a disabled child get no help with heating costs while my husband, who is still earning a reasonable amount, qualifies for Winter Fuel Allowance that we don't need because he's over 60. I'm very encouraged that Nick Clegg has signalled that any further cuts to welfare must come from those who can most afford it. The money that will save is not sufficient, however.

Our record on improving and widening access to a decent state pension as well as ensuring fair annual increases, is undoubtably one of the best things we've done in Government. It's the sort of reform we have been talking about for as long as I've been in the party. Steve Webb wrote about the new Bill for LDV in January:

 It will treat men and women equally for the first time and will value unpaid caring work just as much as a high-flying city job. That is why the big winners from Single Tier will be women, carers and some low earners who haven’t previously received much in the way of earnings-related state pension. And for the first time ever, we will be bringing the self-employed fully into the state pension system.

You know your polices must be good when they're nicked by your opponents. Scottish Finance Minister John Swinney told the Institute of Chartered Accountants in Scotland that an independent Scotland would, from 2016 provide a single rate pension with a triple lock. Willie Rennie took him to task for promising a Liberal Democrat pensions policy without saying how he would pay for it:

The triple lock is a great policy for pensioners which is why we are delivering it in Government.  It's been possible with the economic base of the United Kingdom.  The SNP promise our policy but have failed to show how they will pay for it. Instead of promising everything and costing nothing they should answer the serious questions posed by ICAS about the security of pensions after independence.

Swinney spoke of a "seamless transition" of pensions after independence. This flies in the face of what ICAS said in a report questioning how the pensions system could operate post independence given that many schemes currently operate across the whole of the UK. The effect of EU rules requiring schemes to be fully funded if they operate over more than one country could cause significant problems, they said:

If Scotland became an independent country there would be significant cross-border issues for schemes which currently operate UK-wide. Under EU law (as interpreted by UK legislation), schemes which operate in more than one country must fund their liabilities in full and any underfunding must be rectified immediately rather than through a staged recovery plan. Dealing with underfunding would have major cost and cash flow implications for employers with underfunded cross-border schemes.

That doesn't sound seamless to me.

Swinney's assertions are consistent with the SNP's "it'll be fine" attitude to everything. If you question them, you are accused of scaremongering. Scottish voters are too canny to just cross their fingers and hope for the best. They will need much more credible details if they are to be persuaded to vote for independence than the SNP has yet been able to provide.

Why, though, should voters choose some sort of  imitation of Steve Webb's scheme when they can have the real thing by staying in the UK?

Relief as Government does the right thing on DLA for care home residents

Most Liberal Democrats were pretty horrified when George Osborne announced he was stopping disabled care home residents from claiming the mobility component of Disability Living Allowance.

We passed a motion asking for this to be reinstated at our Spring Conference in March - and today, it's been announced that, finally, this has happened.

This is another example of how the Liberal Democrats can influence things within the Government. It doesn't happen immediately, but I know that this has come about because Steve Webb and other Liberal Democrat ministers have been championing the cause.

And if you want to have some idea what the difference this will make - if it had gone ahead, people like Ana Alicia Bryant, writing here for Leonard Cheshire Disability, would literally have been trapped in her home.

Let's just hope that now the motion we passed on Employment and Support Allowance finds its way into the Welfare Reform Bill. The thing about being in this Government is that our work of taking the sting out of the Tories will never, ever be done. We have to be ever vigilant - and, as a party, stand up and fight when necessary to make sure our voice is heard. The announcement today gives us hope that we can change things.

Interview: Mike Moore MP - Action in Government, ideas for the future

It can’t be much fun being Alex Salmond these days.  The euphoria of May has subsided, and he’s  realised that there’s nobody else to blame for his majority Government’s actions.  On top of that, wherever he looks, he sees the grin of Wilie Rennie,  keen to highlight any example of anglophobia, of  dodging , delaying, ducking and diving. The Scottish Liberal Democrat leader has had accolade after accolade in the press for providing such high quality opposition to the SNP bulldozer.

There’s another Liberal Democrat making Salmond’s daily life uncomfortable.  They don’t come more reasonable than Mike Moore,  Secretary of State for Scotland.   Moore was an accountant before he became an MP.  Precision and detail are what he does. He’s on a mission to nail Alex Salmond’s independence jelly to the wall, this week posing six questions for the SNP to answer.

I caught up with him recently, just as he was finishing his 15^th Summer Tour of his large Borders constituency. He talked for quite a while about the diverse communities on his patch, recounting  every issue raised in each place. It’s clear he thrives on getting out and meeting people.

It’s as well Moore has a huge capacity for work, given that his position as Scotland’s champion in the UK Government requires him to, as he says, “fight like hell”, for Scotland across virtually every area of Government.  Here are just a few examples:

Welfare reform

The anxiety felt by people with long term conditions about the Coalition’s welfare reforms, especially the Work Capability Assessment and changes to Disability Living Allowance is shared by most Liberal Democrats.  Moore has met many times with people affected by the changes and feels that he can help change things:

It’s interesting to hear directly from people that nobody thinks the old system worked particularly well 

and everybody accepts that we need some reform.

 What I’ve been able to do is to take specific examples of concerns back to Iain Duncan Smith and our own Steve Webb who’s been playing a blinder on these issues.

The Work Capability Assessment is at the heart of people’s concerns. We’ve changed it so that the WCA is only one of the bits of evidence that a decision maker will take into account.

There are other issues to work through and I and my colleagues are getting out there, talking to people and feeding their concerns back in.

The Economy

In the wake of disappointing unemployment figures and with growth lower than expected, what did Mike have to say about the effects of the Coalition’s cuts on Scotland’s economy:

With every passing day we see more clearly the global context in which we are trying to fix our economy. We are being recognised internationally as taking the necessary action to deal with the deficit and we escape the huge interest rates being demanded of Greece and elsewhere. It’s not easy to make any of the decisions and they are challenging s for Liberal Democrats but we’re doing it because it’s necessary.

We have some huge legacy issues in terms of the way the economy was too reliant onwards the financial service sector in the south east of England. We’re now trying to support businesses across the country and across all sectors.

Moore has been in regular touch with business and has met with bankers over concerns about lending fairly. He talks about how Vince Cable and Chris Huhne have been responsive to the issues he’s raised from a Scottish perspective. He’s making a strong case for the Green Investment Bank to be based in Edinburgh.

We are making decisions which will have impact for decades and that’s a hell of a responsibility but it’s very exciting.  I want Scotland to take a huge part in that.

Bleak economic news in Scotland is often greeted by an assertion from the First Minister that if he had more powers, everything would be just dandy. Moore, unsurprisingly, disagrees.

Fundamentally as a good liberal I think it’s important that we devolve all the appropriate powers to the Scottish Government – but they have phenomenal power already with the funding they give to, for example, enterprise, planning, higher education. There are broader debates about whether you should devolve Corporation Tax and we will consider their arguments.

Since then, the SNP have published their proposals for Corporation Tax, which they want to cut to 12.5%. Even they admit this would lead to a fall in revenue, cuts in services and the full economic benefits might be felt outside Scotland. 

Air bases, carriers and coastguards

Scotland’s had its share of bad news in the last year in terms of the closure of RAF Kinloss, the loss of the Forth and Clyde coastguards and Leuchars changing from an RAF to an Army base. Moore has been fighting for the best result possible for Scotland. He won through on the aircraft carriers, which will boost employment in Fife and on the Clyde, and it’s clear he’s had a positive influence on other decisions.

It was widely recognised we need to modernise the Coastguard service. The Department of Transport brought forward a series of proposals for consultation. I was very much involved in the discussions. All different options were properly looked at. We’ve reached the solution that recognises modernisation but also takes on board strong evidence from Stornoway and Shetland which suggests they need to stay as 24 hour bases. We’ve moved the original set of proposals to a much better solution.

On air bases, this was a challenging situation and difficult to work through. There are huge, huge challenges coming in Fife with Leuchars becoming an Army base – but there are great opportunities there also.

(That’s a view backed up by Fife Chamber of Commerce)

In Moray, nobody will underestimate the effects of the change, but Lib Dems, Danny, me and others paid a lot of attention to the impact on communities. I’m not going to play that down and there will be difficulties. In the Scotland Office, we had a response group working with communities, the MOD and the Treasury so we could be the focal point and conduit for people’s concerns and information and act internally to challenge things and make sure all the right things were being considered. In Scotland we will have 2,500 more armed forces than before. Scotland’s contribution to UK defence will be significantly enhanced. This shows how importantly the UK Government sees Scotland.

Using the Crown Estate revenues to invest in communities

Next year Scotland’s coastal communities will benefit from a £4 million boost thanks to Mike and Danny Alexander taking it upon themselves to shake up the way the Crown Estate operates in Scotland.

I’ve wanted to make changes as there’s been a growing dissatisfaction with the way the Crown Estate operates, how it engages with Councils and other Government bodies in Scotland.  I’ve probably had more meetings with Crown Estate representatives than my last 10 predecessors to change things.

Danny as a highland MP knew in spades what the issues were around the prospect of vast renewable resources coming to the Crown Estates because of offshore wind and so on and the danger that communities would be sidelined. There’s been an unsatisfactory set of circumstances for communities affected by onshore wind, and this mustn’t be the same for offshore wind. We will see substantial sums of money available for communities around Scotland and they are very pleased with the way this will work.

The Scotland Bill and beyond

The Scotland Bill goes to the House of Lords next week and Moore confirmed that there is still potential for further changes – but there are conditions:

“Any such changes have to be clear cut in what they are set achieve. They need to be properly thought through and they need not to be to the detriment of the rest of the UK.”

I asked him what happens after the Scotland Bill – after all, Liberal Democrats have a strong and positive vision of a federal UK

I’ve been discussing this with Willie since he became leader and we support and understand that our approach and thinking towards devolution doesn’t end with the Scotland Bill. We want to take the work done by the Steel Commission, which set out some key principles for further devolution, to the next stage.

Independence

At some point in the next 5 years, the Scottish people will be asked to vote on independence, and Willie Rennie has already warned that rejection of the idea is not a foregone conclusion.

I am absolutely sure that Scotland benefits from being part of the UK. Our exports to other countries in the world are about £20 billion a year in value. Our exports to the rest of the UK are about £40 billion. We get a huge amount of value from the UK, a single market that enables us to trade without 

additional cost barriers and to work with each other on a straightforward basis

.

My anxiety is that we are entering a phase with the prospect of the referendum which creates a lot of uncertainty for businesses when they are planning their investment for the future. Like the rest of us, they don’t have a lot of detail. There are some fundamental things that the First Minister has to set out so that the people of Scotland understand the terms of the debate.

Last week the Chairman of CBI in Scotland, Linda Urquhart, said something very similar.

Rebuilding the Party

The Liberal Democrats took a huge battering here in May.  Mike spoke at a special members’ forum to discuss the way forward and I asked him what he’d taken from that meeting.

That kind of gathering wouldn’t happen in any other party in the way that we held it – it was an important example of us being true to our philosophy that we talk about things, we’re open and accountable. We as ministers were conscious of the strength of feeling, the sadness that we’ve lost so many colleagues and friends in the Scottish Parliament. There’s no question that what the Coalition Government has been implementing in the last year, was very difficult for candidates. I visited every single one of our key seat candidates at least once and I knew from my own experience on the doorsteps how challenging it was for them.

What impressed me at the Forum was the courage and determination people showed to fight back. There were strong words said, but people were universally committed to getting out there and knocking on doors.

It’s clear that we have to get much better at explaining at what we as Liberal Democrats are bringing to and changing in this government. We’ve a lot of work to do and we are asking a lot of people who’ve spent years working for the party. The result in May was difficult but the resilience of the party and commitment to our principles and determination to fight back was absolute. 

Mike Moore will never be anything other than reasonable and measured. He compares well to a First Minister full of bluff and bluster. His skilful advocacy for Scotland within the Government has already brought changes for the better.  In the constitutional debate, he and Willie Rennie will make a formidable team, keeping the argument real and practical, but also fresh with new ideas for further devolution not just to Edinburgh but beyond, to communities, giving away power wherever they can. 

Farron, Floella and Co talk about Lib Dem values in action

Channel 4 let a bunch of Lib Dem parliamentarians take over their political slot recently. This is their effort, which I'll let you watch before I nitpick.



The good things:

I liked the broad brush stuff - it was the heart and values stuff rather than a list of achievements. I liked Farron making the point that if you liked Lib Dem ideas in the past, you never really got to see them put into practice, but we're making a difference now. I also liked him saying that we didn't bottle out of power when we had the chance.

There was a good mix of winning issues mentioned - pupil premium, raising of tax threshold, warmer homes, restoring earnings and pensions link and rebalancing the economy, but all woven together in terms of the values they showed.  Scottish Liberal Democrat spokespeople, watch and learn. We don't need lists, we do need the Liberal Democrat heart and soul to be let out to speak for itself.

The bad things.

Mostly men, mostly in suits, all middle aged, filmed in offices or near Westminster. A bit of imagination, please!  Where are Lynne Featherstone and Ros Scott, or Jo Swinson and Jenny Willott when you need them? Were they even asked?

I'm getting obsessed about Chris Huhne's hair at the moment. I know it's not healthy (my obsession, not his hair). I just feel like he needs to get it cut and evened up a bit. It's got so bad, that I even took this photo when he was on Question Time recently.

Update: It appears I am not alone in thinking that this was altogether too male. Jo Shaw tweeted me last night to say:

I agree with your point re the cast of the prog, and so do others-led by @DintiBatstone we've emailed Cowley Street about it.

I won't be holding my breath, but lets's hope that the penny starts to drop sometime soon. It does us no good to portray ourselves as a middle class, male party when it's patently not the case.

Pension age rise brings gloom to this house

My poor husband has gone to work with a very long face today.

Not only is he miserable with Hay Fever, but he was born in 1951. That means he was looking forward to picking up his State Pension in 2016.

Not any more.

It looks very much like he's going to have to wait an extra year as the Coalition Government add to a painful week by raising the Pension age.

There is some good, though, as this comes in tandem with a fantastic plan to abolish the default retirement age so that people can choose for themselves when they want to stop working. Some will want to retire at 65 or even 60, but others are keen to continue working and why should they be forced to retire? This potentially is a good move for women whose careers are often broken up by caring responsbilities. I'm in my 40s and I still haven't sorted myself out with a proper career so it potentially presents an opportunity for me to develop one (assuming I can decide what I want to do when I grow up) and not be shown the door in just over 20 years' time. Also it will give women the chance to build up more retirement income.

We'll have to see the details, but I think that this was inevitable. Whenever you make the change, the people who reach the former threshold that year are going to feel pretty fed up. A year from 65-66 is not going to be too difficult, but I don't like the idea of forcing people to wait beyond 70 for their State Pension as is also mooted.

Jenny Willott lives on State Pension for a week

Liberal Democrat MP Jenny Willott has been living on the basic State Pension of £95.25 this week, a huge change from her normal salary of her current gross weekly income as an MP of £1245.50.

She's doing it to highlight how difficult it is to manage to live on such a low income. She's recounting her experiences here on Twitter. It's well worth having a look at some of the basic choices she's having to make. She talked about buying a cheap tin of soup for lunch but then realising there was no tin opener in the office and having to nip out and get one. Most poignantly, she realises how hard it is to buy something as simple as a Remembrance poppy:

"My Remembrance poppy is looking tatty and I need a new one. I appreciate now it's a much bigger sacrifice to buy one as a pensioner."

I guess the other thing to think about is that Jenny is getting the full State Pension whereas many women don't qualify for even that paltry amount because they either worked part time, took time out to have children or look after elderly relatives. Some may have been badly advised decades ago and made decisions that it is now impossible to rectify because nobody will take responsiblity for the mistake.

This week Liberal Democrat Pensions Spokesman Steve Webb wrote in Liberal Democrat News about his fight to obtain justice for women who have been let down by the Pensions system.

He told how he had brought individual cases to the Government's attention and identified that 150,000 wome had missed out on help of around £2000 each because they had not received the Home Responsibilities Protection to which they were entitled from 1978 onwards.

He also identified that some women had not been notified of a special scheme to help those born between 1938 and 1944 boost their pensions in certain circumstances. The government agreed to contact the women concerned and they are likely to receive, between them, millions in a Pensions boost that they were rightfully entitled to.

It's appalling that women have borne the brunt of caring duties, saving the Government a fortune in many cases and then been kicked in the teeth when it comes to receiving even the most basic of State help in their old age. And before anyone reminds me about the Pension Credit, it's not that great and many people who are entitled to it don't claim often because they don't know about it. It's good that we have Steve to fight so tenaciously on their behalf.

Steve Webb secures Government u-turn on MPs' pensions

I've often said that what Steve Webb, Lib Dem MP for Northavon, doesn't know about pensions isn't worth knoowing. It was Steve who spotted that some women may have lost out because the Government didn't inform those who hadn't paid NI contributions for several years at the end of the 90s/beginning of this decade and was able to ensure that they wouldn't be penalised.

Anyway, this isn't my story to tell, so I'll link to his account of how he ensured that taxpayers' contribution to MPs' pensions has been frozen.

He recognises that this is an interim measure as the MPs' pensions are going to have to be much more intensively reviewed and reformed.

LibDig This!