Pensions Bill

My Lords, I wonder whether I can make a brief intervention in this important debate to support the case powerfully made by my noble friend Lady Thomas. I understand perfectly the position that has just been explained in her usual lucid way by the noble Baroness, Lady Hollis, but we will have to face up to this. I have no final costed scheme for the various elements in this important amendment, but my firm belief is that if we do not move to meet the requirements enshrined in it, we may risk the whole success of self-enrolment. As I understand it, between now and 2012, the Government’s thrust is to try to get personal accounts established through auto-enrolment. Auto-enrolment is a big step. I absolutely agree with the noble Baroness, Lady Hollis, that we underestimate at our peril the amount of genuine ignorance—I do not use that word pejoratively, I mean genuine lack of knowledge and understanding of any of this stuff—across the landscape that the Bill is intended to cover. Small businesses will struggle with this throughout the length and breadth of the United Kingdom. Big businesses are much better positioned because of the professional breadth and depth of advice that they have within their ranks. They are used to doing all this and it can be made easy for people in the employment of bigger businesses, but small, micro and family-sized businesses will struggle with this. If businesses struggle, so will the people faced with the important decision. Of course there are financial cycles and the scene that we are facing today may well have settled down by then, but the way that the amendment was presented was absolutely right: people, especially those on the lowest decile of household income, will run with fear from any prospect of their take-home pay being reduced unless someone is able to set the scene for them. The noble Baroness is right; there is a world of difference between advice and information. For me, the amendment says that there needs to be something that interprets information. You cannot safely found on information; you cannot give a leaflet to someone who works in a joiners’ business somewhere in south-east Scotland and be safe in the knowledge that they will go away, read it diligently with a wet towel around their head over the weekend, or over the 30-day period, and come back with a sensible decision. They will not get to the first base of understanding what is being asked of them unless someone interprets that information. Whatever else the House decides about this amendment, information by itself is not enough. For my money, if the Government could even get as far as saying that or saying that they will think it, that would be enough for me, because we could then go on to the more important things such as the location, the format, and the qualifications of the people who are delivering this interpretation of the situation that is being faced by individual families and around which so much depends. Even if personal accounts and auto-enrolment work perfectly and the turn-out is 80 or 90 per cent, which I hope it will be, we will still be left with a nation that is undersaving to a degree that has not yet dawned on the majority of people. It is therefore essential, not only for the Government but for ordinary hard-pressed working families, that auto-enrolment works as well as it can. It cannot work well, however, unless there is someone to interpret for the majority of ordinary folks who are going to be asked to take this decision just what they are facing, and to interpret it reasonably sensibly in terms of their situation and their age. One of the important elements of this is that there is obviously a bigger risk to people over 50, who if they are not careful will fall foul of this by taking the wrong decision. It is not right for the House to pass this legislation without being really clear about what we expect from ordinary folk when coping with this big question. This cannot be done unless there is an element of interpretation in the information service that is currently being proposed. I understand that this is hard and may be expensive. I would prefer it to be face to face. It will not be needed by everyone, but the people who need it really will need it. If they do not get it they will suffer, and that is in no one’s interests. Whether we get anything like what my noble friend has proposed—a gold-plated service that I am absolutely in favour of, although it may be too expensive—we need something. If it is not this, it must be something else, because information by itself is not enough.