marylsommers: This pension reform benefits women, but has one big blot

A flat-rate, simplified pension is good news, as is not penalising mothers and carers. But a key promise has been broken

Two cheers and a boo. It may not be as dramatic as a war, or as politically charged as the NHS changes, but the government's reform of pensions will have a huge effect on real lives. It's a twisting tale of the coalition at its best and its worst ? overall fairness and crisp decision-taking, but also specific unfairness and one badly broken promise.

Let's start with the good news. Ministers are about to announce a new, flat-rate state pension ? expected to be about �155 a week when it comes into effect in four to five years' time. That's much more than the �97.65 basic state pension on offer now, even with the top-ups that guarantee �132.60 a week. The move is bold, fair and quite expensive. According to the Pensions Policy Institute, it could cost about �25bn, though some of this will be clawed back from lower administration costs.

It is fair for two reasons above all. First, because it is not means-tested, far more people will actually receive it. Just now up to a third of poor pensioners don't claim the means-tested benefits they are entitled to, either from pride or horror at the intrusive and complicated paperwork. The flat-rate pension returns us, in essence, to the principles of the 1945 Labour welfare state, rather than the increasingly complex Labour welfare state of the Blair and Brown years.

Simplicity matters. Inclusiveness matters. It is possible to be too clever, sitting in the Treasury and drawing up lists of exemptions and special cases. It's no surprise many people did not understand the difference between Serps (the second state pension), the graduated retirement pension, and the pension credit. On this issue of complexity Labour in power got it wrong, and should admit it.

The change is fair for a second reason, which I have banged on about for some time. It, at long last, rights the old wrong suffered by women who were denied a full state pension in the past because, having paused their careers to look after children or older relatives, they had not built up enough contributions. We had the bizarre situation where people who had sacrificed something to look after family were punished, rather than rewarded. I am among the 99.8% of people who don't quite know what the "big society" is supposed to mean; but I know that handicapping women carers was its opposite.

So far, so good. There are losers too, of course: about 1.5 million people will get slightly less than they would have if they had used the full range of means-tested benefits, plus the Serps top-up. Yet, in the round, this feels like a modest but gently progressive measure.

However, there is a serious wrinkle in the new legislation, which will particularly affect women in their 50s and which directly breaks the coalition agreement. It concerns when the new pension age is to be raised and equalised (at 66). I have no argument with this in principle. In the modern economy it had become absurd that men were supposed to work for longer than women before getting their pensions. And with a longer living and healthier population, a later retirement age is not only sensible but just: younger taxpayers need to be treated properly as they struggle to fund the baby boomers' retirement bulge.

But all big changes need to be introduced carefully and smoothly; something the coalition seemed to understand when it was formed. Here is what it said: "We will phase out the default retirement age and hold a review to set the date at which the state pension age starts to rise to 66, although it will not be sooner than 2016 for men and 2020 for women."

Instead, the retirement age is to be equalised at 65 by 2018, two years earlier than promised, and will move to 66 for everyone between November 2018 and April 2020. Women aged 56 and 57 are particularly hard hit; they suddenly find their pension will not arrive for more than a year later than they thought, and in some cases nearly two years. It will be a horrible surprise to people who don't have the funds or savings to tide them over an unexpected hole in their income.

And there is the question of the broken agreement. As Labour's pensions spokeswoman in the Lords, Pat Hollis, says: "That key coalition agreement promise ? the one that most directly affects women, and poorer women at that ? has been torn up and junked."

There is a political point to make about all this, and a semi-constitutional one as well. Let's take that first. For a long time, ministers have quietly smiled, or even chortled, at being let off the hook for their manifesto promises. Whether it was Nick Clegg and tuition fees or the Tories and the repatriation of powers from Europe, the concessions necessitated by the coalition deal meant both sides could junk manifesto pledges. Doing so has caused political pain and a loss of credibility, but ministers have had a failsafe excuse: "C'mon on, that's what coalition means."

But if it is now the case that the coalition agreement ? the written compromise itself ? can be ignored, then the last vestige of connection between the pledges of the two parties and what they feel obliged to actually do has vanished. They can just go ahead and do whatever they like. This is simply wrong. It may not be, strictly speaking, "unconstitutional", because we don't have that kind of constitution. But it ought to cause widespread indignation.

This leads to the final, political, point. The Lib Dem leadership's response to its vertiginous plunge in the opinion polls and the grim prospect of the next general election is becoming clear. Clegg and Vince Cable are determined to make fairness to poorer families their banner. Whether it's access to higher education, income tax adjustments for lower earners or measures such as the flat-rate pension, this is what they will claim as their theme, the ideological bonus they got from a Tory-led government.

Liberal-minded Tories will find that very offensive, but it is a better bet than relying on winning the AV referendum or claiming a radically different outcome on civil liberties. It is pretty threadbare as families go through the cuts-plus-inflation squeeze, but it's better than nothing.

This injustice to poorer women with few options to find new jobs cuts right across such a claim. Trying to do better by those at the bottom is a fulltime job, which requires attention to detail and no loss of concentration. It is not too late to correct this, and to keep faith with the coalition agreement, which is in effect ministers' new promise to the electorate. Why spoil a decent policy with this single, avoidable blot?

Jackie Ashley

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