Interview: Pensions minister Steve Webb

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Steve Webb is the longest serving pensions minister in recent years
Steve Webb is the longest serving pensions minister in recent years

Type the word 'pension' into politics.co.uk's photo library and you won't come up with images of kindly-looking advisers giving sage advice to grateful customers.

Instead you're more likely to come across pictures of angry looking protesters marching against the coalition's unpopular public sector pensions changes.

Teachers, nurses and other public sector workers might not like the coalition's changes. And the wider public might not be happy about the retirement age creeping up to 67 by 2028.

But in the grand sweep of things pensions is under the radar at the moment in political terms.


This is partly because of the approach of the coalition's pensions minister, Steve Webb, who spends his days pursuing agreement away from the headlines.

"People often say politicians are short-termist," he tells me.

"Some of the things we're working on we could easily put off. But I think we have taken difficult decisions. There are two parties in the coalition buying in; and the more we can work with the opposition, the chances of these things staying the course will be great."

Don't tell anyone, but away from the public sector pension row the parties are carefully engineering a political consensus. This process is taking place at a snail's pace – the auto-enrolment of pensions taking place this autumn was originally put forward by Labour after Adair Turner's proposals – but that only serves to lower its prominence even more.

Webb has a strong reputation for technical competence in this field. His academic background has proved very well-tailored to his portfolio. Given how removed he is from the cut and thrust of debate in Westminster, you could even be forgiven for mistaking him for a technocrat.

This impression has been strengthened by the fact he is the longest-serving pensions minister in years and years. There were ten pensions ministers during New Labour's 13 years in power; at conferences, Webb says, he was initially introduced as "the current pensions minister".

Now that has changed. Having stuck around since the formation of the coalition – and given the lower frequency of reshuffles in coalitions – there is a decent chance he might be able to make it through the entirety of this five-year parliament. The enthusiasm for the job is obviously there.

"What's great about a long run at it is there are some things you can start on day one, and see them through," he says. "Other things you'll just be starting off whenever you cease [doing the job], really. What I've tried to do is take people with me – politicians, officials, the industry – and then hopefully if I fell under a bus tomorrow many of these things would still happen."

We're back to the consensus theme. But although Webb is managing to avoid big political rows on his policy patch, that doesn't mean his life is entirely devoid of conflict.

"We were thrown together in adversity," he says, remembering the first months of the coalition. First came the emergency Budget, then the comprehensive spending review. It was a period when observers noted, across Whitehall, the re-emergence of traditional departmental rivalries which challenged and sometimes supplanted coalition disputes between the Tories and Lib Dems. "As a ministerial team we would all be sitting around the secretary of state's table making some pretty difficult decisions," Webb remembers. "I was engaged across the whole department, not just in pensions, trying to bring a Liberal Democrat perspective."

The Treasury and Department of Work and Pensions have found themselves at loggerheads more than most. Perhaps this is why Webb is ever so slightly critical of the Treasury's approach to handling the public sector pensions negotiations. His Lib Dem colleague Danny Alexander and Tory Cabinet Office minister Francis Maude dealt with union leaders.

"Perhaps what we could have done better was communicated to the scheme members quite how good their provision will be after all the reforms," Webb suggests. "Many people don't appreciate quite how good public sector provision still is."

Webb's work is not all plain sailing. Pensions is about the government, and individuals, but it is also very much about, in his words, "employers playing their part". As a minister he is well-respected by the industry, but many firms remain sceptical about some of his bolder ideas.

At the top of the list is Webb's approach to workplace pension reforms. He's seeking a third way, of sorts: looking beyond the classic dichotomy of the gold standard final-salary pension schemes offered by some of the bigger employers, and the more miserable defined contribution schemes where a percentage of the salary is simply put into the pot. Could a 'defined ambition' model gain traction, where the employer takes on a little bit of the risk? "They won't do it out of the goodness of their heart, but they may do it because it's part of the way they approach their employees," Webb hopes. This is unfinished business, for employers are not yet willing to play the game.

Ordinary citizens do not have much choice. The state pension age will rise to 67 in 2028, that's a given; but the increase to 68 could come well before the 2048 date planned by the last government. The DWP is expected to put out a white paper in the next month or so outlining a more automatic link between how long people live and what the state pension age is.

Such a move would go a long way towards depoliticising the state retirement age for good. During a period when the inexorable trends of demography are making politicians' tasks much harder, it's a legacy which future pensions ministers will be grateful to receive.

A reshuffle is rumoured for later this year, but it seems very unlikely that David Cameron and Nick Clegg will be tempted to replace Webb from his office in DWP. His fair-minded approach to the job is underpinned by a deep understanding of the nuts and bolts of the sector. Dealing with "numbers with lots of noughts on the end" might be daunting to some, but not this man.

"Pension planning's a long-term business, so ideally you want continuity," Webb says. "Of course different political parties will have different priorities, but if we can get broad consensus that's got to be in the national interest."

What's got to be done has got to be done, even if it's something that's never going to win many votes. That doesn't mean pensions isn't a vote loser. So if Webb can help the coalition keep pensions out of the headlines, so much the better.

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