Clause 9 - Duration of assessed income period
State Pension Credit Bill [Lords]
4:30 pm
Mr Ian McCartney (Minister for pensions, Department for Work and Pensions; Makerfield, Labour)
I can see why the amendment
might have some appeal. Arguably, such a mechanism might facilitate a more seamless reintegration back on to pension credit—and seeing as I have been advocating that in Committee, I want to maintain my consistency. It would also prevent the person's pension credit from being reduced when he returned home and reclaimed because he had won the lottery, either English or Spanish. Of course we are ignoring lottery wins during the assessed income period not because we think that such people need pension credit, but because we want to reduce intrusiveness for all recipients of pension credit. We can live with ignoring a few individuals' good fortune for the sake of simplification for the overwhelming majority of pensioners.
If a new pension credit claim is needed, it would seem perverse not to take that opportunity to reassess the claim there and then. I doubt whether the taxpayer, the lottery winner or the hon. Gentleman would consider that to be unreasonable.
On the point of seamless reclaiming, a person who returns to Great Britain would obviously need to contact the Pension Service in order to reclaim. It is therefore debatable that the amendment would make reclaiming easier by ensuring that such a person's income would not have to be reassessed.
In designing pension credit, a key consideration has been to keep the system as simple and hassle-free as possible for the customer. That is precisely why we have moved from the intrusive weekly means test to a five-year assessed income period. That is also why we intend strictly to limit the number of changes in circumstances that would require a reassessment of income. Protracted absence abroad is one such instance. We also think it is right when a pension credit claim closes. As I said before, if it is a fresh claim, it seems entirely consistent to make a full assessment.
After all, the hon. Gentleman should accept that an individual's circumstances may have deteriorated during that time. When one goes abroad, one spends one's capital. It would seem sensible that, at the point of re-entry into the pension credit, a full assessment should take place, especially as it might be to the advantage of the pensioner.
Not all people who go abroad know how long they will be away. For instance, the hon. Member for Canterbury (Mr. Brazier) mentioned a tragic case last Tuesday about one of his constituents, who travelled abroad to visit a terminally ill daughter and ended up having to care for her for years rather than weeks or months. It cannot be very satisfactory to hold closed claims in a kind of limbo pending a reclaim that may or may not occur on a future unspecified date.
It is also fair to say that it may be in the claimant's interest for a full assessment to be carried out on return from a protracted absence, because people are more likely to win than to lose out. People who have been abroad for some time are more likely to be in a lower income stream because they have used their savings than they are to have won the lottery in Spain. I ask the hon. Gentleman to withdraw the amendment.
Mr. Boswell: The Minister gets an A for the clarity of his explanation, but only a C for acceptability. I am sorry to disappoint him; he is clearly distressed.