Guarantee Credit
State Pension Credit Bill [Lords]
10:15 am
Ms Maria Eagle (Parliamentary Under-Secretary (Minister for Disabled People), Department for Work and Pensions; Liverpool, Garston, Labour)
Local services and the Pension Service will still be available to everyone. It is true that the Pension Service will do much of its processing work and will hold much of its telephone interaction with members of the public from central locations. There is nothing innovative or terrible about that; it already happens in the case of retirement pensions, in which many pensioners interact perfectly happily on the telephone. There is no doubt that the Pension Service will have a local arm, although it is a national service. Whether it is based in the jobcentre or a different building will vary from place to place. We intend to ensure that those pensioners who would prefer to see someone face to face will have the opportunity to do so at their convenience, rather than at that of those providing the service.
There will be surgeries and places in the local community to which pensioners can go to meet Pension Service staff if they need to do so face to face. If they need a home visit, that can be arranged. All of us Members of Parliament are subject to such demands from our constituents, and we know that we can always make appointments to see constituents at their convenience. Of course, there are always constraints to do with when we are in the constituency and so on. The idea is that the service that is made available will be tailored to meet the needs and requirements of the individual pensioner. That is our aspiration, and there is no reason why we cannot make it happen. Apparently, a letter has been sent to the hon. Gentleman by my right hon. Friend the Minister for Pensions; I am sure that that deals in greater detail with the concerns that he has raised.
Clause 2 introduces the guarantee credit, which is similar to the minimum income guarantee. Primarily, it is an anti-poverty measure; it is intended to ensure that there is a minimum income to which all pensioners are entitled.
I could explain all the detailed provisions of clause 2, but I am unsure whether that that would be a productive use of the Committee's time, because I sense that there is not much opposition to the clause. However, I will continue.
The clause introduces a calculation of the first element of pension credit, which is the guarantee credit. That will be available to everyone over 60 years of age. It will bring pensioners' incomes up to a basic guaranteed level, which we expect will be £100 for a single pensioner and £154 for a couple. Those rates are continuing to rise, due to the increases that we have introduced since 1997.
The guarantee credit will be simpler than the minimum income guarantee, which it replaces. It will remove the numerous rates and premiums, and provide a level of income under which no pensioner needs to live. As it is designed for pensioners rather than for people of working age, it will be possible to get rid of some of the extraneous questions on the form. It will have a simpler structure that will enable the system to minimise intrusion into pensioners' affairs, by only asking them the questions to which answers are really necessary, thereby removing one of the obstacles that prevent pensioners from claiming the money that is rightfully theirs. Another obstacle will also be removed, because it will be much more clearly an entitlement.
We also hope that the guarantee credit will tackle pensioner poverty. It will give additional help to those with extra needs, such as severely disabled pensioners, pensioners with caring responsibilities and pensioners with owner-occupier housing costs. Therefore, some beneficial elements of income support additions will be carried forward into the guarantee credit. It will be calculated by making up the difference between the pensioner's income and the guarantee credit.
Savings credit is the other fundamental element of the pension credit, and we will discuss that when we address clause 3. I hope that the Committee will support clause 2, as it is a basic building block of the pension credit.
Question put and agreed to.
Clause 2 ordered to stand part of the Bill.