But deputy speaker stops Lord Sikka’s” full restitution” amendment going to a vote

The government were roundly defeated in the Lords – by 220 votes to 178 – yesterday over its plans to abolish the triple lock for next year’s pension rise – reducing the up rating for pensioners from 8.1 per cent to 3.1 per cent.

The loss of cash for pensioners in the next five years is enormous. They lose a share of £5.4 billon next year, £5.78 billion in 2023-24, £6.1 billion in 2024-25, £6.5 billion in 2025-26 and £6.7 billion in 2026-27. That amounts as Lord Sikka told peers to £30.5 billion removed from pensioners’ pockets over the next five years.

What happened yesterday in the Lords were two separate approaches to challenging the government’s decision to end for next year the link between pensions and earnings.

The first which was successful was put forward by Baroness Ros Altmann, a former Tory pensions minister, in a series of amendments. She had the support of Labour’s Baroness Sherlock, a former special adviser to Gordon Brown and an ordained priest at Durham Cathedral; Baroness Janke, a Liberal Democrat peer and former leader of Bristol council; and Baroness Boycott, a crossbench peer, feminist and former editor of the Independent newspaper.

It was one of these amendments that led to the defeat of the government in the Lords. This particular amendment had the support of former Labour Cabinet minister, Baron Hain, Liberal Democrat baroness Janke and crossbencher (and ex Conservative) Baroness Wheatcroft former editor of the Sunday Telegraph.

Basically the amendment challenged the government’s calculation of the rise in earnings at 8.1 or 8.3 per cent and wanted a new calculation stripping out the effect of the pandemic. Lady Altmann initially had put this at 3.8 per cent but yesterday suggested it could be as high as five per cent and then suggested she was had no firm figure. This particular approach had the support of Labour.

The official wording maintained the link with “earnings obtaining in Great Britain, as adjusted to take account of the exceptional impact of the COVID-19 pandemic on the level of earnings”.

She told peers: ” after seeing alcohol and fuel duty cut in the Budget and the bank surcharge allowance raised, and adding up the amount of Exchequer savings that those measures entail, half the cost of not honouring the triple lock will cover the costs of just those three measures. I appeal to noble Lords across the House: is this really the country that we believe that we should be living in? Is that the priority for public spending?”

The key point about this amendment is that it does not restore the full 8.1 per cent to pensioners and it leaves the government to decide – if it wants to – the new earnings rate.

Baroness Stedman Scott, the DWP Lords minister, did not sound convinced. Referring to a blog on the Office for National Statistics site she said “Using a range of possible estimates based on a method that cannot be agreed on does not provide a sufficiently robust basis for making critical decisions about billions of pounds-worth of expenditure.”

The second more radical approach came from Prem Sikka, Lord Sikka. He was backed by Baroness Bennett, Natalie Bennett the former Green leader; Baron Davies of Brixton – Bryn Davies- a former Labour union leader; Baroness Blower, Labour and former general secretary of the National Union of Teachers and Lord Hendy, Labour, a barrister and labour law expert. Lord Sikka told them the government’s measure “is also contrary to the Government’s levelling-up agenda. Rather than levelling up, it impoverishes citizens and condemns millions of current and future retirees to a life of poverty and misery. There is no moral or economic rationale for this; indeed, none has been offered by any Minister so far.

“The Government’s own statistics, published on 3 September 2021, say that the average weekly pre-2016 state pension is £169.21 for males, £141.98 for females, and the overall mean is £155.08. The average weekly post-2016 pension is £166.34 for males, £160.11 for females, and the overall average is £164.23. As we can see from these figures, women are especially impoverished by the way that pensions are calculated and paid. They will be hit even harder by the abandonment or, as the Minister might say, the temporary suspension of the triple lock.”

….”Low pensions condemn our citizens to a life of misery. Some 1.3 million retirees are affected by malnutrition or undernutrition. Around 25,000 older people die each year due to cold weather, and we will no doubt hear the grim statistics for this year, possibly on 26 November when the next numbers are out. Despite the triple lock, the proportion of elderly people living in severe poverty in the UK is five times what it was in 1986, which is the largest increase among major western countries. Some 2.1 million pensioners live in poverty, and the poverty rate has actually increased since 2012-13.”

Then extraordinarily Baroness Fookes, a Tory peer who was a deputy speaker, blocked a vote on Lord Sikka’s amendment leading Lord Sikka to say he was cheated. She argued that his opponents had made more noise than his supporters to justify the decision.

If this amendment had been passed it would have allowed pensioners to get the full uprating of 8.1 per cent but would have wrecked the bill. Labour did not support this and would have abstained. A spokesman for the Labour Whip’s office explained:”Prem’s amendment was not in line with the Lords’ constitutional position, in that it would wreck the core purpose of a bill that the Commons had already voted to support.

There was all party support however for a full impact study into pensioner poverty after peers from all sides had expressed concern about the plight of pensioners this winter and the DWP minister promised this when faced with possibility of yet another Lords revolt.. There was also a promise from the minister for a detailed explanation of the national insurance fund – which appears to have a £37 billion surplus which the government says cannot be used to pay for keeping the triple lock.

What is clear is that Rishi Sunak, the Chancellor, has been silent about this surplus in all the documents he produced to accompany the Budget. If it turns out that it has been used secretly to repay government debt I suspect there will be an all mighty row as 12 million pensioners will feel they have been cheated yet again by successive governments. Watch this space for more developments.

Read here who supported revising the triple lock and those who were against pensioners getting a penny more. Those in favour included 3 Tories, 99 Labour, 41 cross benchers,64 Liberal Democrats,13 non affiliated, including one Green Party and 2 Democratic Unionist Party.

Those against included 165 Tories, 11 crossbenchers and 2 non affiliated peers. Hereditary peers also voted against. You can see all their names on the link.

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