I would like to speak to amendments 1 and 6, which have been tabled in my name and the names of other Liberal Democrat Members, and in favour of the cross-party amendment 7, tabled in the name of the hon. Member for Airdrie and Shotts (Neil Gray), as well as to his new clauses 4 and 5. I was very pleased to see new clauses 4 and 5 tabled and I pay tribute to the work of the all-party group on plumbers’ pensions—chaired by the hon. Member for Perth and North Perthshire (Pete Wishart)—of which I am a vice-chair.
I have a constituent who was a member of the plumbers’ pension scheme, and the trustees failed to notify him and others that, were they to leave the scheme, he would find himself liable under section 75. He had been a responsible small business employer, enabling all his employees to be part of a pension scheme and to save for their retirement. When he retired and wound up the business, he was not made aware of the consequences by the trustees from a pensions perspective of doing so. That means that through no fault of his own, he is now in a position where, because his business is no longer operating, he cannot apply for current easement schemes and, because his business was not incorporated, he is personally liable for the debt. He is now an elderly man and is being pursued by the trustees. They are threatening to repossess his house and his life savings are at risk. Were that to happen, the sums recovered from him would not even pay off half the outstanding debt.
My constituent told me:
“We are now in the third year of this, and it is taking a toll on my health, and also on the health of my wife.”
If passed, new clause 4 would turn my constituent’s life around. The safeguards are there. His total debt is only a tiny proportion of the total liabilities, and the trustees
have determined that the majority of cessation events will be too costly or lengthy to seek recovery. That is one of the issues here: there is an injustice going on that has not received the attention it deserves because relatively few people have been affected by it, but that also presents the opportunity that something can be done and I hope that the Minister will comment accordingly on new clause 4 and look further at this plumbers’ pension issue. It is causing hardship and anxiety for, arguably, an increasingly vulnerable group of people.
I shall now address part 5 and schedule 10 and, in particular, clause 123 on defined-benefit schemes. My colleague in the Lords, Baroness Bowles, tabled the original amendment to clause 123 that would ensure that defined-benefit schemes are treated differently, depending on whether they are open or closed. I pay tribute to Baroness Bowles. Her amendment had cross-party support in the Lords, so it was disappointing that the Government removed it in Committee two weeks ago.
My amendment 1 would reinstate Baroness Bowles’s amendment, and amendment 7 in the name of the hon. Member for Airdrie and Shotts is a revised version of it, which I have also signed. I did not have the chance to sit on the Bill Committee, but I did follow proceedings and I was encouraged by the Minister’s comments during Committee on open defined-benefit schemes. He said:
“We acknowledge that if such schemes do continue to admit new entrants and do not mature then the scheme will not actually reach significant maturity. We are content that such a scheme retains the same flexibility in its funding and investment strategies that all immature schemes have.”––[Official Report, Pension Schemes Public Bill Committee, 5 November 2020; c. 81.]
I welcome those comments, which imply that open schemes should, and will, be treated differently from closed schemes, in accordance with different investment, liquidity and maturity, and I hope the Minister will be able to recommit to that statement on the Floor of the House today. I urge him to accept either amendment 1 or amendment 7, which would put that commitment on the face of the Bill and provide much needed reassurance for open schemes that have contacted me, and, I am sure, have contacted other Members, in advance of this debate.
We need that reassurance because there is real concern about the regulator’s consultation. Looking at the consultation document, there are places where it looks like the regulator is making the right noises on DB schemes.