New clause 4 - Self-employed

Part of State Pension Credit Bill [Lords] – in a Public Bill Committee at 2:45 pm on 25 April 2002.

Alert me about debates like this

Photo of Julian Brazier Julian Brazier Opposition Whip (Commons) 2:45, 25 April 2002

I understand that entirely.

As two of my hon. Friends have already remarked, the net result is that a growing proportion of people are self-employed. The catch is this. Where does it leave the self-employed if the Government continue, through a range of measures that I will not list again, trying the Committee's patience, to provide incentives for employers to ensure that the proportion of self-employed people in the total work force goes up each year, while self-employed individuals find that they are making almost the same contributions—7 per cent. compared with 10 per cent.—and providing more than two thirds of the contribution of their employee counterparts? Where does that leave those people, who will not be part of the great new pensions future that is allegedly unfolding before us in the Bill? It will leave us with a two-tier economy.

The statistics quoted by my hon. Friend the Member for South-West Bedfordshire a moment ago were chilling. They showed that some 40 per cent. of self-employed people had made no contribution, but the saddest statistic was that 10 per cent. had tried, but had now stopped making contributions. That is why the new clause is necessary. We must have a system to monitor what is going on in the self-employed sector. The Government say that their measures are designed to provide better pension prospects, but if that sector, which is growing fastest in the market, is left out of the picture, the provisions will be unfair in the long run.