Published by James Jones-Tinsley on
The fall-out from a General Election inevitably involves a game of musical chairs; masquerading as a Parliamentary reshuffle.
The ‘rearranging of deckchairs’ this time round saw the previous Pensions Minister, Richard Harrington, being shuffled off to the Department for Business, Energy and Industrial Strategy, and the resulting vacancy filled by MP for Hexham, Guy Opperman; replete with the wide-ranging title of “Parliamentary Under Secretary of State for Pensions and Financial Inclusion”.
In addition, David Gauke – former chief secretary to the Treasury - has been appointed as the new Secretary of State for Work and Pensions.
Aside from concerns that the role of Pensions Minister has become a ‘revolving door’ again, (with three in the last two years, after Steve Webb), as well as being further demoted to sharing a brief with whatever “Financial Inclusion” entails, how have the two new incumbents settled in to their respective roles?
The Queen’s speech on 21 June 2017 was bereft of pomp and circumstance and unusually short, (probably so she could make the first race at Ascot that afternoon).
The items on the legislative agenda for the next Parliamentary session – which will last for two years instead of one, due to Brexit - included the “Financial Guidance and Claims Bill”, which will allow the Department for Work and Pensions to establish the new ‘Single Financial Guidance Body’, (replacing the Money Advice Service, Pensions Advisory Service and Pension Wise) to coordinate the provision of money guidance, pension guidance and debt advice.
Oh, hang on – we’ve got “guidance and “advice” mentioned in the same breath again, and readers will recall the way that these two words were often used interchangeably by George Osborne, during his days as Chancellor.
Mr Gauke stated the Government intends to increase the State Pension age from 67 to 68 in 2037-39Mr Gauke
Surely Mr Gauke would know the difference between the two? Apparently not. Speaking at the Association of British Insurers’ “Long-Term Savings Conference” in early July, Mr Gauke twice described the new guidance service to be created, as an “advice body”; a faux pas that faced rebuke at a subsequent debate in the House of Lords, where the Bill was first introduced.
Apparently, Mr Gauke acknowledged his mistake, stating that he used to be a regulatory lawyer, and so was aware of the difference between guidance and advice. Time will tell.
In other pension-related matters, Mr Gauke said there would be no “fundamental” changes to pension tax relief in the near future, whilst leaving the door ajar for reform later, and then – just two days before Parliament packed its collective bucket and spade, and headed off on holiday until early September (they’ve only just gone back!) – announced that an increase in the State Pension age was being brought forward once again.
Accepting the recommendation of John Cridland within his recent independent review on the subject, Mr Gauke stated the Government intends to increase the State Pension age from 67 to 68 in 2037-39; some seven years earlier from its current legislated date of 2044-46, adding “…This is the fair thing to do”.
This will not go down well with the Labour opposition, who argued in their Election Manifesto to cap the State Pension age at 66 from 2020, and what about the ‘Women Against State Pension Inequality’ (the so-called “Waspi women”), who are still facing relative inaction from the incumbent Government to come to their aid?
Step forward Mr Opperman; no doubt keen to get off to a good start in his new role, and appease these ladies, many of whom now face poverty in their 60s, as a result of the increase in the female State Pension age from 60 to 65 over the last few years.
And what ‘olive branch’ did Mr Opperman proffer, during a recent Parliamentary debate on the subject, to garner their support?
Namely, that affected women should consider becoming apprentices.
Perhaps unsurprisingly, this didn’t go down particularly well within the House of Commons, with angry heckling, and cries of “shame on you” ringing through the chamber.
And angry ‘Waspis’ took to social media to voice their discontent, with one of them tweeting, “while I’m becoming a 63 year old apprentice, who’s caring for 85 year old parents, do I take them with me?”
So – not the most auspicious of starts for our new Parliamentary Under Secretary of State for Pensions and Financial Inclusion (what a mouthful!), and as well as Mr Gauke’s “advice” gaffe, his decision to announce something with far-reaching implications for millions of people - just before Parliament went into recess - could be viewed with either cynicism, or even contempt.
I wonder what their End of Term Reports say?
This blog was first published on the SIPPs Professional website