Cost of Living: Pensioners

I return to pension income and want to raise pension credit with the Minister. This top-up benefit is the simplest tool at the Government’s disposal to lift pensioners out of poverty. It feels like every year we have a new attempt at increasing uptake with a fancy leaflet or other information campaign. I am sure we all go to the drop-ins, have our pictures taken and share them with our constituents, but pension credit take-up remains stuck at 63%, which suggests that the campaigns simply are not working. Pensioners either do not know about the benefit or do not realise they are eligible, or some struggle with the stigma of being seen to claim it.

I have been in this role for more than three years, and I have spent a lot of time having conversations about how to improve uptake. Clearly, an annual leaflet is not doing the trick. We need a long-term strategy on pension credit uptake with two key focuses: how we share data to identify people eligible for pension benefit, and how we target them efficiently and effectively so that they actually claim it and do not feel stigmatised?

I dispute the claim of the Minister’s colleague, the Minister for Disabled People, Health and Work, the hon. Member for Mid Sussex (Mims Davies), in a written response to me yesterday, that pensioner poverty is falling. It is not. The claim was based on statistics before housing costs, which is distinctly disingenuous. Increasingly, pensioners face high housing costs, as more continue to rent privately into older age. Twice as many rent now than a decade ago—a trend set to continue as it is harder for young people to get on to the housing ladder.

We must tackle the poverty immediately in front of us, but we must look at long-term drivers of poverty among pensioners and stop this trend in its tracks. There are two parts to that: ensuring that people enter retirement sufficiently equipped, and ensuring that no one falls into poverty after ending their working life. Ultimately, our experience during our working life determines what happens to us when we retire. If someone has to take time out of work or only works part-time because of ill health, child rearing or caring, they will be substantially worse off in retirement. Those last two reasons are incredibly gendered, with women more likely to miss out on savings for their retirement.

“characterised by detachment, fear and complacency”.

I think that those views would be represented in this place, too, when I think about the different things I did before I came to this place and the different pension pots I have.

I understand that planning for retirement is difficult and complicated unless you are an actuary or a financial specialist. I can hear the response of my teenage children if I try to bring it up at home or see the eyes glaze over on the doorstep, but people do care about the result of not engaging. My challenge for the Minister is to bridge that gap and change our culture so that people knowing about their pension is normal, and not scary but a standard part of people’s financial planning and education.

I am interested to hear the Minister’s ideas, but I will put to him just one that keeps coming up when I speak with experts and stakeholders. Will he consider a trial to test the impact of automatically booking savers for pensions guidance appointments when they turn 50? Let us try to make it easy, because lots of things can happen in retirement: your health can change, you could be bereaved or divorced, you could become a carer. The economy could be crashed, causing a sustained cost of living crisis. To try to understand drivers of poverty among older people, Independent Age followed the outcomes for a cohort of pensioners who entered state pension age above the poverty line. Within 10 years almost half had fallen into poverty. Something else is clearly happening that we need to understand. I have talked about a lot of different moving parts in the overall pension and poverty landscape, but what we need—what older people need—is a comprehensive plan.

I will end by asking the Minister this: will he consider a cross-Government review of what support an older person needs to stay out of poverty? Will he bring Westminster up to the standards of other nations and support a Westminster commissioner for older people and ageing? I would like to get something done and I am sure that the Minister would too. I look forward to hearing his response.