The Labour party has pledged to compensate women affected by a state pension age hike with a £58bn commitment.
In an announcement on the Labour party website yesterday (November 24), shadow chancellor John McDonnell said the pay-outs were a “historic debt of honour” to the women born in the 1950s.
The compensation scheme, which the party stated would be delivered within its first five-year term of government, is a one-off payment which would see women receive up to £31,300 each, with an average payment of £15,380.
The redress would depend on the year of birth: women born between April 6, 1950 and April 6, 1960 would be paid £100 per week up to April 5, 1955 with funds tapered down for those born after that date.
The total cost of the proposal is estimated to be £58bn before tax, but it could be paid in instalments, for example £11.5bn per year, if spread over five years, Labour stated.
Mr McDonnell said: “We’ve prepared a scheme to compensate these women for a historical wrong.
“It’s one that they were not able to prepare for and for which they’ve had to suffer serious financial consequences as a result.”
Plans to increase the state pension age were first announced in the Pension Act 1995 but these changes were accelerated as part of the Pension Act 2011.
Campaign groups The Women Against State Pension Inequality and Backto60 have claimed the changes were implemented unfairly, with little or no personal notice.
The groups, which are calling for compensation for those affected, have also claimed that changes were implemented faster than promised with the 2011 Pension Act and left women with no time to make alternative plans, leading to devastating consequences.
In October, the High Court dismissed a legal challenge from Backto60, which claimed that the changes in the state pension age were discriminatory.
Debbie de Spon, communications director at Waspi, said the campaign group was pleased with the commitment from the party.
She said: “We await the detail with interest and urge the party to develop a clear framework which outlines how and when this would be implemented.
“We look forward to engaging with Labour to design this system of compensation and ensure that we achieve the best and fairest outcome for all 1950s born women at the earliest opportunity.”
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