Later today the Government will confirm that it intends to raise the retirement age and restore the link between pensions and earnings. This morning’s Today programme noted that it was Mrs Thatcher who broke the link a quarter of a century ago. Today did not remind its listeners, however, that the Tories had already made the policy shift nearly three years ago.
In his last major act as Tory leader, Iain Duncan Smith made the policy change in a bid to revive the savings culture and deliver social justice for pensioners. Devised by David Willetts the commitment was savaged at the time by
Labour as "a cruel deceit on pensioners" and as "unsustainable". Despite an otherwise nightmare Tory conference the very popular restoration of the earnings link helped give the Tories a 6% lead in a YouGov poll and was due to be rolled out in a massive programme of regional events and mailshots. Michael Howard had next to no enthusiasm for the policy and when he became leader he did not pursue that programme or ever seriously promote the £5bn commitment.
Philip Hammond MP, Shadow Work & Pensions Secretary, has attacked the failure of Labour’s new pensions package to provide fairness for women. Commenting on the fact that ‘only’ 30 years of National Insurance contributions are now required for a full basic state pension for women retiring from 2010, Mr Hammond told ePolitix: "It does not seem fair that a woman retiring on a April 1, 2010 will get a full state pension based on 30 years’ contributions, but that a woman retiring on March 31 with the same contributions will be condemned to a lifetime on a partial pension."