Pensions Bill

I, too, will be brief. I want to support new clause 25 tabled by the hon. Member for Cannock Chase (Dr. Wright). I very much welcome what the Minister said about assistance schemes this afternoon, although it is a pity that we do not have the provisions before us so that we can see exactly what he is proposing. I know that the provisions of new clause 25 would deal with my concerns about a pension scheme in my constituency, but I am not sure whether the Minister’s proposals would cover that scheme. The problems with schemes for solvent employers have poisoned the well of pension reform for far too long. They have been left out of the financial assistance scheme, although there is little to choose between what has happened to them and to insolvent employers. I cite the case of a scheme in the small burgh of Kirriemuir in my constituency. The company remains in being—indeed, it provides valuable jobs in the community—yet workers nearing retirement find that their pensions provide nothing like the sums they expected. The scheme is being wound up and the value of each pensioner’s pot is to be paid into a private pension scheme. An employee described for me the situation when they were told that the scheme was being would up: they were told, in effect, ““It’s your pension or your job?. It is difficult for people in small communities to come to terms with that. I am told that the company would have gone into insolvency had the scheme not been wound up. The wind-up started in June 2004 and has not yet completely finished, so I want to be sure that people such as my constituents would be covered by the new aspects of the financial assistance scheme that the Minister announced today. I am sure that new clause 25 would cover their situation, but it is a great pity that we do not have the Minister’s proposals. What tests will he apply in relation to insolvency? What evidence will a company have to produce before it can be covered by the new scheme? In the case I described, the employees were told that the company would go into insolvency unless the scheme was wound up. What made things worse for many employees in that case was that the pension scheme was put under a trustee company, which was also undertaking the winding-up process, and workers found it difficult to obtain information. They were told that the cost of answering their questions about the wind-up of the scheme would be set against its assets, thus further reducing the amount available to pensioners. A circular from the trustee company states:"““Please remember that there is a cost to answering questions from members, meaning that the funds in the scheme will be further depleted.?" Not unnaturally, members wondered what to do. Should they pursue their interests, or would that mean that they were throwing away even more of their money? They were in an impossible situation. If the scheme that the Minister has announced covers such people, it is very welcome indeed, but as has been said by other Members we need clarity today; this poisoned situation must not drag on. We cannot move on with pension reform, in particular the personal accounts that the Government propose, unless we deal with the problems now. I intend to support the cross-party amendments on the lifeboat fund, but new clause 25, or a similar provision, must be passed in conjunction with them if we are to bring justice to all the pensioners who have suffered in this disaster.