Pensions Bill

My Lords, I agree with every word that the noble Baroness has just said. I declare a rather unpleasant interest, in the sense that I fit two of the categories that have been described here. I am shortly to be 75 and I had an excessive investment in the Royal Bank of Scotland and other banks, because my stockbroker thought that they were a good dividend yield that would produce the sort of income that was needed in a pension scheme. All pension schemes are now going to be wrecked by the Government’s decision that dividends from banks should not be paid for a long time to come. I rise, though, for another reason. I suspect it is possible that the Minister may introduce a topic that has already been referred to today, and which, if a quotation in one of last week’s papers is correct, led the Chancellor of the Exchequer to say, ““Oh, there’s no need to do this because there is already an escape route. An alternative is already in place””. It is the escape route that my noble friend referred to as having been designed for the Plymouth Brethren. He said it applied to only a tiny handful of people. In fact, that rule is never restricted to the Plymouth Brethren; a large number of people took it up because they saw a way of avoiding estate duty. The Government intervened, perfectly reasonably, to stop that escape route, but the proposition that you can take out an alternative secured pension remains. Indeed, I have one. For some time, I have had what is known as a drawdown arrangement in my personal pension scheme—managed by my broker, not tucked away in an insurance company or in any other way—and therefore do not have to buy an annuity. I do not begin to understand why, if the Government are prepared to allow that escape route, they are going to be so rigid about giving a rather wider escape route to all those who have not followed that route and for whom it might be quite difficult to enter into an alternative secured pension and a drawdown arrangement in the final months before the annuity rule applies to them. If it is right and proper that a considerable number of pensioners can manage their affairs in this way, and quite a lot of them do, I see no possible reason why the Government should object to my noble friend’s other proposition that there should be a temporary escape mechanism—that is all he is suggesting—during this horrendous moment when the markets have been plunging through the floor. Like a number who have spoken, I think the whole rule should be dropped altogether, but let us be content for the moment with the amendment and rescue those people who do not have the escape route that I have provided for myself. I hope, and it is just possible, that some of my investments may recover in time for me to get rather a better pension than it looks as if I might at the moment, but at least I will not be forced in the next five months to buy an annuity at almost the worst possible moment. If the Chancellor is saying, ““It’s all right, I don’t have to do anything; there’s an existing escape route””, he should warmly embrace my noble friend’s proposition and offer an escape route for all those facing the kind of desperate situation that I would have been in if I had not already taken the drawdown and alternative secured pension route. I am not a member of the Plymouth Brethren, and there was no actual restriction applying it to them. There were statements that that was why it had been introduced, but a large number of people who do not belong to the Brethren have alternative secured pensions. It is a legitimate thing to do, and the Chancellor and the Government are now apparently saying so. Let us have no more nonsense; let us accept my noble friend’s amendment and give hope to a lot of people who are otherwise in a pretty desperate state at present.