Pensions Bill

I am glad that the Under-Secretary of State mentioned yesterday, because, to turn to Government new clause 38, I have to say that I am a little disappointed by the speech that the Minister for Pensions Reform just made; he seemed to think that he was arguing in yesterday’s debate. The tone today is not partisan. Today, I hope, is about the search for consensus on a solution. As the Minister said, new clause 38 responds to the Budget announcements that the Chancellor and the Secretary of State for Work and Pensions made. It improves the scheme significantly for younger members who would otherwise have been excluded, but it does not address the real issues to do with speed of payment, the effectiveness of the financial assistance scheme, and the benefit payable. The increase in the cap will benefit some higher-paid scheme members, but that does not address the issues affecting the desperate people whom the Members most interested in the subject meet repeatedly. We will not oppose new clause 38, because it is a significant improvement and a helpful step forward, but it does not address the real issues before the House today. Amendment (a), which the hon. Member for Cardiff, North (Julie Morgan) tabled, would amend Government new clause 38 by increasing the benefits provided in the new clause to Pension Protection Fund levels. It is similar in its effect to new clause 24. We have two concerns with amendment (a). First, because of the reference to qualifying members, it appears to include only those members who are over 65, rather than those who are over scheme retirement age, as the PPF does, yet that group includes some of the people in greatest hardship. Secondly, we believe that, contrary to what the Minister said, it is necessary to balance the moral case for helping that group of people with the obligation on us all to protect the taxpayer. I shall outline how we think that our proposals to use unclaimed assets, backed up by a Government loan, gets that balance right. The amendment tabled by the hon. Lady and new clause 24 simply transfer the problem to the taxpayer. We accept that, as the Minister pointed out, if a loan is made, a residual contingent liability is taken on, but if we are to reach a solution to the problems, we have to recognise that we are all in this together. There has to be a sharing of the pain. The pensioners concerned have to accept that they will receive only 90 per cent. of the benefits that they would have got, the industry has to accept that it will have to yield up the unclaimed assets, and the Government have to extend the loan to bridge the gap, so that relief can be provided right now, while the unclaimed assets are being collected. I have set out the two reasons why we cannot support amendment (a), tabled by the hon. Lady; we urge her to consider supporting new clauses 41 to 45 instead, which have the same objective and would deliver the same outcome for pensioners, but which take a different route.