New Clause 9
Welfare Reform Bill
4:00 pm
Tony McNulty (Minister of State (Employment and Welfare Reform; Minister for London), Department for Work and Pensions; Harrow East, Labour)
It is a great pleasure to welcome you in the flesh as well as in the spirit, Mr. Amess, as I am sure you were with us this morning. As my hon. Friend has said, new clause 9 seeks to give contribution credits to help people caring for a grandchild under 12 to build up their state pension. It seeks also to give similar rights to people caring for 20 hours a week for a partner, relative or friend who is sick, frail or disabled, which is in fact already Government policy.
I would say to my hon. Friend in the nicest way possible that his new clause is deficient in a number of ways on both counts—in terms of grandparents and carers of the disabled. Let me explain why and review them both in turns. As he said, a wide power exists in section 23A of the Social Security Contributions and Benefits Act 1992. That allows regulations to be made to define people engaged in caring with a view to awarding them credits. He also perfectly fairly said that regulations are currently being drafted under the provision, which will be laid before Parliament this year. We think those draft regulations will go further than his new clause does in terms of the part about caring for a sick or disabled person.
The regulations propose that contribution credits be awarded to someone caring for one or more persons for a total of 20 hours a week where each person is receiving one of a range of attendance-related benefits, or where the need for care is certified by a health or social care professional. They also propose cover for periods when care ceases for a time to allow for, among other things, holidays, respite care and sickness. In that respect, therefore, the new clause offers nothing more and will almost certainly restrict the conditions under which credits can be given to someone caring for a sick or disabled person.
I turn now to the proposals to award credits to grandparents caring for a grandchild under 12. We recognise the significant contribution—as my hon. Friend has said—that grandparents make to the community. However, they are not a homogeneous group. Many grandparents will be over state pension age and unable to benefit from credits; many of the younger grandparents will be combining caring with employment. We sincerely believe, like my hon. Friend, that the improvements we have already introduced will greatly increase the likelihood that those younger grandparents will qualify for a full basic state pension. In most cases they will have received home responsibilities protection when bringing up their own children, and that is to be converted to qualifying years of credit from 2010. That, together with the reduction in the number of qualifying years for a full basic state pension to 30, and the opportunity introduced in the most recent Pensions Act to buy voluntary contributions for past periods, will mean that very few grandparents will need additional credits. It is estimated that by 2025 almost half a million extra women over state pension age will be entitled to full basic state pension as a result of these reforms. I will, therefore, ask my hon. Friend the Member for Glasgow, North-West to withdraw the clause.
I am, however, aware of the strength of opinion favouring some special recognition for grandparents who may, in some cases, give up their own prospects so that they can help their children. We are considering whether any further provision is needed for them and we will not limit that consideration to grandparents since similar care may equally be given by aunts, uncles and older siblings. We are satisfied, though, that if we do conclude that such provision is useful, there is already scope to provide that within secondary legislation. I am happy to work with my hon. Friend both on the forthcoming regulations and on any consultations we make in terms of a special recognition of grandparents and other groups. In that spirit I ask that he withdraw the new clause but am happy to continue working with him on the matter because I agree with the sentiment and thrust of his argument.