Labour’s WASPI pledge ‘drives coach and horses’ through its spending plans, claims IFS
Labour’s plan to compensate millions of women hit by the state pension age rise “drives a coach and horses” through its manifesto spending plans, according to a leading think tank.
Paul Johnson, director of the Institute for Fiscal Studies (IFS), said the scheme to compensate the Women Against State Pension Inequality (WASPI) women would lead to "another £12billion of borrowing every year for the next five years", on top of what Labour has already promised to spend.
His comments came after Shadow Chancellor John McDonnell confirmed that the £58billion price tag for the policy did not appear in Labour’s "fully costed" election manifesto.
Appearing on the BBC's Andrew Marr Show, Mr Johnson said: “This drives a coach and horses immediately through the manifesto pledge to get to current budget surplus to remain at current budget balance.”
The IFS has previously labelled Labour’s plans to raise £80billion of tax revenue through increased contributions from companies and the top five per cent of earners as "not credible".
But appearing on Sky News's Ridge On Sunday programme, Mr McDonnell said the latest spending pledge - which would be covered by increased government borrowing - was necessary.
He said: "This is a very special arrangement, a contingency, in the same way that government has in the past dealt with matters like this.
"The scale of this injustice is enormous, this is a discrimination against women in particular, older women, many of whom are on low pay anyway but now I think many of them have suffered so it’s an injustice we have to address."
The new policy would pay up to £31,300 in compensation to 3.7 million women who were affected by a rise in their retirement age from 60 to 65 in 2010.
On whether the announcement was an opportunistic stunt after Boris Johnson was given a hard time during the TV election debate on this subject, Mr McDonnell said: "We have been working on this for the last 18 months, we’ve met all the different groups, what they call the WASPI groups.
"We consulted them on a proposal, a range of proposals, including this and we came to the conclusion that if we didn’t act soon, the suffering and stress would continue."
Boris Johnson has said he has "sympathy" with the WASPI campaigners, but has not pledged to meet their demands for compensation.