Pensions Bill gets Green Light
Hmm! Well, the Pensions Bill finished its passage through the House of Commons last week and now goes on to the House of Lords for the next stage of the proceedings. With both the Conservatives and the Lib Dems supporting the Bill it appears to have the political consensus required to make it through.
The current Pensions Minister, James Purnell, moved a series of government amendments dealing with the Financial Assistance Scheme for those that have lost their savings in occupational pension fund collapses. Purnell explained how the scheme would now guarantee 80 per cent of expected core pensions to all 125,000 people affected and how a review, led by industry experts, would look at topping up that 80 per cent.
The Conservative shadow work and pensions secretary, Philip Hammond, welcomed the government amendments as far as they went: "[They] improve the scheme significantly for younger members who would otherwise have been excluded, but it does not address the real issues to do with speed of payment, the effectiveness of the financial assistance scheme, and the benefit payable."
Conservative spokesman Nigel Waterson moved new clause 7 on the 'performance of the personal accounts delivery authority' and new clause 29 on the 'winding up of the personal accounts delivery authority'.
Waterson explained that the new clauses proposed to deal with the "philosophical difference" between the government and the opposition on the role of the personal accounts delivery authority. "They [the government] are far too keen to set up the personal accounts delivery authority and leave it to the authority to sort out the detailed design of personal accounts and make all the difficult decisions. We do not see it that way at all. There are serious issues that need to be addressed now".
The new clauses were defeated 293 votes to 217.
Liberal Democrat shadow work and pensions secretary David Laws spoke to new clause 28 on certification schemes for carers. Laws explained his new clause proposed to extend carers credit to those groups of carers not covered by the provision of the Bill.
The proposed new clause was withdrawn.
In summing up, Purnell explained that the Bill "implements the most ambitious reform of our pensions system in modern times. It provides the basis for a sustainable and affordable system that strikes a new balance between the responsibility that Government have for retirement and the responsibility of individuals and their employers. It addresses past inequalities and inadequacies, and embeds in our pensions system the crucial values of fairness and simplicity."
Waterson pledged the Conservative's support for the Bill: "It is right to say again that, as the Minister indicated, we support the basic direction of travel that the Government are setting out. In our last election manifesto, we promised to restore the link between the basic state pension and earnings and set out how that would be paid for. We also promised to tackle the gross unfairness—as the Minister has said—of a situation in which less than a third of women receive the full state pension. It would be the height of churlishness to oppose the measures simply because they have been proposed by another party, but we do have concerns."
Laws also pledged Liberal Democrat support for the Bill but expressed reservations on pensions compensation.
So, some reservations, but the Bill passed and now moves to the Lords.
Mind you, the Lords Second Reading will mean a return to a debate on the principles of the Bill, rather than the detail. So the big picture could be up for discussion again. It will be interesting to see to what extent their Lordships take up the opportunity to discuss Personal Accounts, rather than the substance of this first Pensions Bill.
If you’ve got time to kill and would like to read the full debate, just click here.
23 April 2007
Source: Hansard, Orders of the Day, Pensions Bill 18 April 2007
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