Pensions Bill

My Lords, I am nowhere near 75 so I do not need to declare an interest, but I am extremely concerned about this. If we look at the root cause of the financial catastrophe unfolding around the world, it is clear that it is about people borrowing too much and not saving enough. Surely we should be doing everything we can to encourage people to save for the future. I strongly support my noble friend’s amendment, although characteristically he has been more moderate than I would have been. I do not think we should have this rule at all, and I believe that my noble friend is of the same view. But in the interests of pensioners who are going to suffer real hardship, it is a sensible and moderate compromise. I do not envy the Minister if he does not accept the amendment today because it will seem rather inexplicable when the Government can find huge sums to bail out the Royal Bank of Scotland and the Bank of Scotland. I mention those two banks in particular as their shares are typical of the kind held by elderly people. They believed that they were safe as houses and they considered the size of the dividend. The shares are part of their pension schemes, and now partly because of the Government’s insistence that no dividends are available, the funds are devastated. So even if the Minister is not able to accept the amendment now, I hope that the Government realise that there is real hardship and that the people who are suffering are those who have done the right thing—they are the people who have put money by. If, we are to recover in the long term, to coin a phrase from Keynes who seems to be very fashionable on the Benches opposite these days, we will do so because people and Governments put money aside for a rainy day. People should be encouraged to save. The tragedy for those who have done that, particularly with this Government—we saw it in the changes to the tax rules for dividend income and in the Government’s toing and froing on what people could and could not invest in their SIPPs—is that they are beginning to think, ““I am not sure I will be safe by putting my money into a pension scheme because the Government can act in an arbitrary way and change or alter the rules at any time””. Surely we should be liberalising the rules as far as we can, consistent with not putting a burden on the welfare state. Again, I support my noble friend’s amendment, and if the Government are serious in their rhetoric that they will help people through this crisis, and if that has any value at all, surely the oldest and most vulnerable in our society who have done the right thing should benefit first from that rhetoric.