The Single Tier Pension - Another Lib Dem Gain

Like our tax code, pension provision in the UK has grown in a piecemeal, ad hoc way. Problems in the system have been addressed as they come up with little notice taken of the effect on the overall system, and little care taken to prevent the system becoming over-bureaucratic. Indeed, given that many reforms originate with the bureaucrats, this has, perhaps, been part of the intention; whilst the political interventions have often fallen victim to the law of unintended consequences.

For some decades now, the state pension has had two elements - the Basic State Pension with entitlement based on the number of years of National Insurance Contributions made and a second tier: first GMP, then the State Earnings Related Pension Scheme (SERPS) and latterly the State Second Pension (S2P).

These second tier pensions were related to earnings (within certain bands) over the working lifetime. Since the late eighties up until last year, it was possible to opt-out of SERPS and use National Insurance rebates to buy alternative private pension provision. The advisability of this varied dependent on circumstances and actuarial forecasts - but that is another story!*

Under Labour, "Pension Credits" were introduced - these were payable to pensioners on low incomes in order to top-up the State Pension. They were, however, withdrawn through the use of a taper where a pensioner had alternative savings and private pension income. The effect of this was to penalise personal pension provision and saving for retirement - particularly at the low end of the pension income spectrum.

The Liberal Democrat manifesto at the last election committed the party to a "Citizens Pension" payable at the level of the pension credit, when resources allowed. The single-tier pension is very similar and the aim is for it to come into force in April 2017: There was no equivalent in the Conservative Manifesto (which committed to protecting the value of Pension Credits) or the Coalition Agreement; this is a coalition policy, yes, but it has heritage on the Liberal Democrat side of the Coalition.

In a letter to Lib Dem members, Steve Webb MP, Pensions Minister said:

"The single-tier pension is a fairer way of ensuring people will get a decent pension in their old age. It will treat men and women equally for the first time and will value unpaid caring work just as much as a high-flying city job. That is why the big winners will be women, carers and some low earners who haven’t previously received much in the way of earnings-related state pension. 

This new ‘single-tier’ pension has much in common with the long-cherished Liberal Democrat goal of a Citizen’s Pension. The basic idea is that someone starting work under the new rules will build up just one state pension. We are ending the fiendishly complex system of two state pensions and tax credits that Labour presided over. 

Our reforms go back to William Beveridge’s original idea of the modern state pension. Beveridge had envisaged a single, simple, decent state pension, paid after a lifetime of National Insurance Contributions. It will be set above the level of the basic means-test (currently £142.70 per week) and the full rate will be payable for 35 years of National Insurance Contributions. 

Successive governments tinkered with the state pension. That means we now have a system the Pensions Commission declared as one of the most complex in the world. Worse still, the current system actually discourages some people from putting anything aside. 

As the plans I unveiled today show, it doesn’t have to be like that in the future. Another example of Liberal Democrats in the Coalition Government delivering a truly radical reform, and one that we can be proud of."

Andrew

*For the avoidance of confusion, I should point out that the ending of "Contracting Out" was introduced by Labour and carried through by the Coalition.

£14,815,000 for Schools in Bristol

Find out how much the Pupil Premium is worth in area or school by clicking here.

David Laws, Minister of State (Schools) at the Department of Education has today announced another step forward in the funding of the Liberal Democrat's Pupil Premium which channels extra funding to schools based on the number of pupils claiming (or having claimed in the past 5 years) free school meals.

The premium for 2013/14 will be £900 per pupil (worth £1.875bn according to this briefing from the Department for Education - as opposed to the figure on the above link - although I believe the latter may include the cost of other related schemes). This is an increase from £623 in 2012/13 and a step towards a target of channelling £2.5bn in this way.

The beauty of the Pupil Premium is that it is an additional sum for the school to use in the way they best see fit. There is no central dictation of how to spend the funds so they can be used for the general good of all the pupils or in a more targeted way. Outcomes are monitored by Ofsted, though, so any spending should have a measurable result.

It's another example of a thoroughly progressive measure being pushed from the Liberal Democrat Manifesto, through the coalition agreement and into practice by Lib Dems in Government. In hard and austere times, we are - contrary to the popular narrative - working to introduce fairness into the system. We can't always be successful but we can make our successes count. 

Andrew

Gaining in Government, Differentiating from the Tories

Being a Liberal Democrat is not always never easy but some things have the power to make it all worthwhile - and in the last few weeks there have been a number of things that fall into that category.

I've discussed Equal Marriage here, here and here. And equal marriage legislation is something of which we can be, justly, proud.

But there have been other things which have made me proud to be a Lib Dem: The raising of the personal allowance as far and as fast would never have happened under either a Labour or Conservative Government: millions have been lifted out of Income Tax and millions more have had their Income Tax cut.

On Leveson, Nick Clegg set new parliamentary precedent by setting out a distinctive Liberal Democratic response from the Government front bench.

Liberal Democrats have also been central to the introduction (from 2015) of shared Parental Leave: allowing parents to decide what best works for them when they have a newborn child.

This week, two parliamentary committees have challenged the Government: the Home Affairs Select Committee has called for a Royal Commission into Drugs and the Joint Committee of the Houses of Commons and Lords has torn apart the Draft Data Communications Bill.

On both of these issues, Clegg has stood up and supported the outcome of the reports in direct conflict with the Prime Minister and the Home Office.On both of these issues he has stood firmly, and vocally on the side of Liberalism.

Here is the Deputy Prime Minister in his letter to Members and Supporters this week:

Dear Andrew, 

Do you want the Home Secretary to be able to order the storage of vast quantities of data about who you email and call, your physical location, your web browsing and Facebook sessions? No, neither do I. Untargeted, blanket powers like these are an invitation for future governments to invade your privacy.

That's why this week I pressed the pause button on the Communications Data Bill that was going through Parliament. A special committee was established to look at the legislation and its conclusions, published on Tuesday, were crystal clear - the legislation didn't strike the right balance between our security and our personal privacy. We need to have a fundamental rethink and produce better proposals which give the police and security professionals the powers they need without going over the top. 

My decision sparked controversy in some quarters, with the usual allegations that by attempting to protect civil liberties you are, by default, on the side of terrorists and paedophiles. I’m not usually inclined to dignify such arguments with a response, but let me just repeat what I said in the papers: of course we need to look at what new technology means for how we protect people from serious crime, and we will need to take new measures to address the problem. But we can do that by striking the right balance between our collective security needs and our individual right to privacy. 

That is a difficult balance to strike - even more so when you are in Government. But it is no use standing up for civil liberties in opposition if you then forget all about them in power. It’s the same pattern that sees politicians rule out a sane approach to drug laws until they are safely out of office and only then they reveal they always favoured the kind of approach this week’s Home Affairs Select Committee suggested - a willingness to look in an open-minded way at all the evidence and alternative ways of dealing with the problems caused by drugs. 

In all of this I am bewildered by the way some of the biggest opponents of any kind of independent regulation of the press see no problem with the apparently limitless Government regulation of individual citizens. Liberalism for me is about protecting people from overmighty institutions while enabling people to get on in life. That’s not easy and we must always ensure that we ask ourselves tough questions, but I’m confident we are playing our part in getting the balance right. If you want to help the Liberal Democrats as we campaign for civil liberties you can support us here.

Thank you,

To subscribe to Nick's weekly letter, click here.

Andrew

A special mention to Julian Huppert MP who (along with Lord Strasburger) was a member of the Joint Committee and is also a member of the Home Affairs Select Committee. A true Civil Libertarian and justly one of our most highly regarded MPs.

Equal Marriage: A Lib Dem Gain.

Be in no doubt, this would not have been achieved as fast and as comprehensively as it has without the Lib Dems in Government. You only have to look at the number of Tory backbenchers who are against the issue to see it wouldn't have been pushed through a Tory government - and the jury's out as to whether Labour would have pursued it.

It may not be perfect, there may still be work to do, but EVERY Lib Dem can be proud today.

Don't Go To Corby*...

...come to Bristol instead!

Two weeks today in Bristol we have a Mayoral Election. If you are anywhere near, your help in support of our candidate Dr Jon Rogers would be much appreciated.

As you are no doubt aware, Bristol is currently a minority Lib Dem administration. The Labour candidate is currently favourite which would see a Mayor drawing his cabinet from the minority party on council! With Jon as mayor we can continue to drive forward Liberal Democratic principles in the City.

There's an action day this Saturday; if you are at a loose end, why don't you sign up here. Otherwise, the campaign office is open every day from now until Nov 15 - and there's always things to be done!

Andrew

*Obviously if you are in the vicinity of Corby (or Cardiff, or Manchester) then I wouldn't to stop you helping there; but if you're nearer Bristol - or making a special trip - then this is really the place to be!

An improved Focus - and an appeal

When I started Lib Dem Gains in December 2010, I envisioned making 2 or 3 short posts a week as a digest of Liberal Democrat achievements in government and how these were being reported in the Lib Dem blogsphere and beyond.

My first post outlined my intentions for the blog thus:

"I intend it to function as a digest of links to news reports and blog articles about positive Liberal Democrat achievements arising from the coalition. Occasionally I shall cross-post longer pieces but don't anticipate I'll have the time to do that on an ongoing basis."

Unfortunately I never kept up the pace of the posts and as a result, the blog looks a bit sorry for itself. I do think, however, that there is room for a positive blog "tracking and celebrating Liberal Democrat influence on Government Policy." Almost exactly 18 months after that first post, the Lib Dems are still being used as a punchbag, despite a good many achievements in implementing manifesto commitments or minimising the excesses of the Conservatives. So I'm asking for help...

Whether it be the Pupil Premium, Increased Tax Allowances or Civil Marriage Equality, - or any one of a host of other issues - if you have something positive to say, I want to hear from you. I'd like, somehow, to build Lib Dem Gains into a kind of online, national edition of Focus. I'm not sure how, yet, but think additional content from both guest and regular bloggers could be one way forward.

If you want to help, drop me an e-mail.

Andrew 

P.S. I would note that the remit of Lib Dem Gains is a positive one. There are issues that I do not agree with the Government on and I express these opinions elsewhere. I'd ask potential contributors to do the same.

Election Broadcast

In common with every other Lib Dem Blogger, here's the Local election Broadcast which succinctly outlines some of the key achievements in National Government. I particularly like Nick Clegg's comment that

"we should make sure that tax cuts are aimed at people on middle and lower incomes and I just want us to move the tax system in a direction where there is less tax on income, effort and work and more tax on wealth and the wealthy."

The video is light on achievements in Local Government - I assume these will be elaborated on later in campaign and by local parties - but party members got an e-mail from Jo Swinson MP today which outlined some of these too:

Unlike Labour and the Conservatives, every Liberal Democrat council in England has frozen council tax.

Also, according to the Local Government Chronicle, Liberal Democrat councils are twice as likely to give pay rises to low paid workers compared to Labour and five times more likely than the Conservatives.

Anyway, here's the video:

Andrew