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Mr. Quentin Davies: A few moments ago, the Minister said that it was not true, as I had contended, that group personal pensions would not qualify as stakeholder pensions. I refer him to page 53 of his document and paragraph 29, which states:
- "Existing personal pensions will not therefore be able to describe themselves as stakeholder pension schemes."
Mr. Timms: No. What the document says is absolutely right. Of course group personal pensions will not qualify as stakeholder pensions; they are personal pensions--they are different. I repeat the point that I have made to the hon. Gentleman: nothing in the document will make it any more difficult to provide a group personal pension than it is today.
Our proposals in the Green Paper are based on the principle that those who can afford to save should do so, but that those who cannot afford to save should also be able to look forward to security in retirement. It rests on three key proposals: the minimum income guarantee, the state second pension and a new system of funded stakeholder pension schemes.
The first element is the minimum income guarantee: £75 per week for a single pensioner from April, which will be available to all those who meet the conditions for entitlement to income support. It will be increased every year, and our long-term aim is that it should rise in line with earnings so that even the least-well-off pensioners will be able to share the benefits of rising national prosperity. It is fundamental to those proposals that the benefits should be enjoyed by the many and not just the few.
We announced in the Green Paper that we will consider how we can relax the savings limit and consider the possibility of introducing an income disregard. We want to encourage saving and ensure that there is not a penalty against pensioners for saving. We will introduce measures to achieve that.
Looking forward, under the policies that we inherited, we would have been heading for a position where many people would retire on to a pension that would leave them--
Miss Kirkbride:
Will the Minister give way?
Mr. Timms:
I cannot. Time is running short and I apologise to the hon. Lady.
People who have worked and paid contributions throughout their working lives would go straight on to income support. That would be the case for people earning less than £15,000 a year even if they had been in the state earnings-related pension scheme throughout their working lives. How can we instead ensure that people who have
paid and contributed throughout their working lives can be assured of a retirement income above the minimum income guarantee level, outside means testing?
We want to reduce dependence on means-tested benefit in retirement. That is the objective we have set ourselves, and I believe that the whole House will share it. Some people have suggested that the way to achieve that is to restore the link between the basic state pension and earnings rather than prices. That would be an immensely expensive measure, but a large group of people--those earning, throughout their lives, between the lower earnings level and about £6,000 per year--would retire directly on to income support, unless they had made their own provision. Despite the huge expense, it would not achieve what we want.
What about increasing compulsion? The hon. Member for Gainsborough (Mr. Leigh) talked about that. At the moment, there is a significant degree of compulsion, and people are required to contribute 4.6 per cent. of their pay into SERPS or a contracted-out scheme. If we doubled that figure to 9 per cent., people earning less than £9,000 a year would still retire on to the minimum income guarantee level.
Restoring the earnings link would not work. Increasing compulsion would not work. We need what might be called a third way--the state second pension to replace SERPS. That is what we have proposed, and it will achieve the objective that we have set. The first two pillars of our proposal are the minimum income guarantee and the state second pension. The third pillar--the key pillar--is stakeholder pension schemes, which will be secure, low cost and flexible.
We also want to encourage the development of occupational schemes which, as has been said a number of times in the debate, are one of the great welfare success stories of this century. We want to encourage people to join an occupational scheme, if they are able to do so, and to boost confidence in good schemes through a quality in pensions accreditation programme.
We want to achieve regulatory simplification and, in a parallel exercise to the Green Paper, we have issued a consultation document on our proposals. In a very simple, powerful innovation, we have proposed that every pension scheme member should receive a combined pension forecast every year which tells them exactly where they stand.
Our proposals represent a redrawing of the contract for pensions between the state, the private sector and the individual. Those who can save for their retirement have the responsibility to do so, and the state must provide effective security for those who cannot. That is the principle on which our reforms are built and I take pride in commending them to the House.
Question put, That the original words stand part of the Question:--
The House divided: Ayes 185, Noes 327.
Tellers for the Ayes:
Tellers for the Noes:
Question accordingly negatived.
Question, That the proposed words be there added, put forthwith, pursuant to Standing Order No. 31 (Questions on amendments) and agreed to.
Mr. Deputy Speaker forthwith declared the main Question, as amended, to be agreed to.
AYES
Ainsworth, Peter (E Surrey)
Allan, Richard
Amess, David
Ancram, Rt Hon Michael
Arbuthnot, Rt Hon James
Atkinson, Peter (Hexham)
Baker, Norman
Baldry, Tony
Ballard, Jackie
Beggs, Roy
Beith, Rt Hon A J
Bercow, John
Beresford, Sir Paul
Blunt, Crispin
Boswell, Tim
Bottomley, Peter (Worthing W)
Bottomley, Rt Hon Mrs Virginia
Brady, Graham
Brake, Tom
Brooke, Rt Hon Peter
Browning, Mrs Angela
Bruce, Ian (S Dorset)
Burnett, John
Burns, Simon
Burstow, Paul
Butterfill, John
Cable, Dr Vincent
Cash, William
Chapman, Sir Sydney
(Chipping Barnet)
Chidgey, David
Chope, Christopher
Clappison, James
Clark, Rt Hon Alan (Kensington)
Clark, Dr Michael (Rayleigh)
Clarke, Rt Hon Kenneth
(Rushcliffe)
Clifton-Brown, Geoffrey
Collins, Tim
Colvin, Michael
Cotter, Brian
Cran, James
Curry, Rt Hon David
Davey, Edward (Kingston)
Davies, Quentin (Grantham)
Davis, Rt Hon David (Haltemprice)
Donaldson, Jeffrey
Dorrell, Rt Hon Stephen
Duncan, Alan
Duncan Smith, Iain
Emery, Rt Hon Sir Peter
Evans, Nigel
Faber, David
Fabricant, Michael
Fallon, Michael
Fearn, Ronnie
Flight, Howard
Forsythe, Clifford
Foster, Don (Bath)
Fowler, Rt Hon Sir Norman
Fox, Dr Liam
Fraser, Christopher
Gale, Roger
Garnier, Edward
Gibb, Nick
Gillan, Mrs Cheryl
Goodlad, Rt Hon Sir Alastair
Gorman, Mrs Teresa
Gorrie, Donald
Gray, James
Greenway, John
Grieve, Dominic
Gummer, Rt Hon John
Hague, Rt Hon William
Hamilton, Rt Hon Sir Archie
Hammond, Philip
Hancock, Mike
Harris, Dr Evan
Harvey, Nick
Hawkins, Nick
Heald, Oliver
Heath, David (Somerton & Frome)
Heath, Rt Hon Sir Edward
Heathcoat-Amory, Rt Hon David
Horam, John
Howard, Rt Hon Michael
Hughes, Simon (Southwark N)
Hunter, Andrew
Jack, Rt Hon Michael
Jackson, Robert (Wantage)
Jenkin, Bernard
Jones, Ieuan Wyn (Ynys Mon)
Jones, Nigel (Cheltenham)
Keetch, Paul
Kennedy, Charles (Ross Skye)
Key, Robert
King, Rt Hon Tom (Bridgwater)
Kirkbride, Miss Julie
Kirkwood, Archy
Lait, Mrs Jacqui
Lansley, Andrew
Leigh, Edward
Letwin, Oliver
Lewis, Dr Julian (New Forest E)
Lidington, David
Lilley, Rt Hon Peter
Livsey, Richard
Lloyd, Rt Hon Sir Peter (Fareham)
Loughton, Tim
MacGregor, Rt Hon John
McIntosh, Miss Anne
MacKay, Rt Hon Andrew
Maclean, Rt Hon David
Maclennan, Rt Hon Robert
McLoughlin, Patrick
Major, Rt Hon John
Malins, Humfrey
Maples, John
Mates, Michael
Maude, Rt Hon Francis
Mawhinney, Rt Hon Sir Brian
May, Mrs Theresa
Moss, Malcolm
Nicholls, Patrick
Norman, Archie
Oaten, Mark
Öpik, Lembit
Ottaway, Richard
Page, Richard
Paice, James
Paterson, Owen
Pickles, Eric
Prior, David
Randall, John
Redwood, Rt Hon John
Rendel, David
Robathan, Andrew
Robertson, Laurence (Tewk'b'ry)
Roe, Mrs Marion (Broxbourne)
Ross, William (E Lond'y)
Ruffley, David
Russell, Bob (Colchester)
St Aubyn, Nick
Sanders, Adrian
Sayeed, Jonathan
Shephard, Rt Hon Mrs Gillian
Shepherd, Richard
Simpson, Keith (Mid-Norfolk)
Smyth, Rev Martin (Belfast S)
Soames, Nicholas
Spelman, Mrs Caroline
Spicer, Sir Michael
Spring, Richard
Stanley, Rt Hon Sir John
Steen, Anthony
Streeter, Gary
Stunell, Andrew
Swayne, Desmond
Syms, Robert
Tapsell, Sir Peter
Taylor, John M (Solihull)
Taylor, Matthew (Truro)
Taylor, Sir Teddy
Thompson, William
Tonge, Dr Jenny
Townend, John
Tredinnick, David
Trend, Michael
Trimble, Rt Hon David
Tyler, Paul
Tyrie, Andrew
Viggers, Peter
Walter, Robert
Wardle, Charles
Waterson, Nigel
Webb, Steve
Wells, Bowen
Whitney, Sir Raymond
Whittingdale, John
Widdecombe, Rt Hon Miss Ann
Wigley, Rt Hon Dafydd
Wilkinson, John
Willetts, David
Willis, Phil
Wilshire, David
Yeo, Tim
Young, Rt Hon Sir George
Sir David Madel and
Mr. Stephen Day.
NOES
Adams, Mrs Irene (Paisley N)
Ainger, Nick
Ainsworth, Robert (Cov'try NE)
Allen, Graham
Anderson, Donald (Swansea E)
Armstrong, Ms Hilary
Ashton, Joe
Atherton, Ms Candy
Atkins, Charlotte
Austin, John
Barnes, Harry
Barron, Kevin
Bayley, Hugh
Beard, Nigel
Beckett, Rt Hon Mrs Margaret
Begg, Miss Anne
Benn, Rt Hon Tony
Bennett, Andrew F
Benton, Joe
Bermingham, Gerald
Berry, Roger
Best, Harold
Blair, Rt Hon Tony
Blears, Ms Hazel
Blizzard, Bob
Blunkett, Rt Hon David
Boateng, Paul
Borrow, David
Bradley, Keith (Withington)
Bradley, Peter (The Wrekin)
Bradshaw, Ben
Brinton, Mrs Helen
Brown, Rt Hon Gordon
(Dunfermline E)
Brown, Russell (Dumfries)
Browne, Desmond
Buck, Ms Karen
Burden, Richard
Burgon, Colin
Butler, Mrs Christine
Byers, Rt Hon Stephen
Caborn, Richard
Campbell, Alan (Tynemouth)
Campbell, Mrs Anne (C'bridge)
Campbell, Ronnie (Blyth V)
Campbell-Savours, Dale
Canavan, Dennis
Caplin, Ivor
Casale, Roger
Cawsey, Ian
Chapman, Ben (Wirral S)
Chisholm, Malcolm
Church, Ms Judith
Clapham, Michael
Clark, Rt Hon Dr David (S Shields)
Clark, Dr Lynda
(Edinburgh Pentlands)
Clark, Paul (Gillingham)
Clarke, Charles (Norwich S)
Clarke, Tony (Northampton S)
Clelland, David
Clwyd, Ann
Coaker, Vernon
Coffey, Ms Ann
Cohen, Harry
Coleman, Iain
Colman, Tony
Connarty, Michael
Cooper, Yvette
Corbett, Robin
Corbyn, Jeremy
Corston, Ms Jean
Cousins, Jim
Cranston, Ross
Cryer, Mrs Ann (Keighley)
Cryer, John (Hornchurch)
Cummings, John
Cunliffe, Lawrence
Cunningham, Jim (Cov'try S)
Curtis-Thomas, Mrs Claire
Dalyell, Tam
Darling, Rt Hon Alistair
Darvill, Keith
Davey, Valerie (Bristol W)
Davies, Rt Hon Denzil (Llanelli)
Davies, Geraint (Croydon C)
Dawson, Hilton
Dean, Mrs Janet
Denham, John
Dismore, Andrew
Dobbin, Jim
Dobson, Rt Hon Frank
Donohoe, Brian H
Doran, Frank
Drew, David
Drown, Ms Julia
Dunwoody, Mrs Gwyneth
Eagle, Angela (Wallasey)
Eagle, Maria (L'pool Garston)
Efford, Clive
Ellman, Mrs Louise
Etherington, Bill
Ewing, Mrs Margaret
Fatchett, Derek
Field, Rt Hon Frank
Fitzpatrick, Jim
Fitzsimons, Lorna
Flint, Caroline
Flynn, Paul
Follett, Barbara
Foster, Michael Jabez (Hastings)
Foster, Michael J (Worcester)
Foulkes, George
Fyfe, Maria
Galloway, George
Gardiner, Barry
George, Bruce (Walsall S)
Gerrard, Neil
Gibson, Dr Ian
Gilroy, Mrs Linda
Godman, Dr Norman A
Godsiff, Roger
Goggins, Paul
Gordon, Mrs Eileen
Griffiths, Jane (Reading E)
Griffiths, Nigel (Edinburgh S)
Griffiths, Win (Bridgend)
Grocott, Bruce
Grogan, John
Gunnell, John
Hain, Peter
Hanson, David
Harman, Rt Hon Ms Harriet
Heal, Mrs Sylvia
Healey, John
Henderson, Ivan (Harwich)
Hepburn, Stephen
Heppell, John
Hesford, Stephen
Hill, Keith
Hinchliffe, David
Hoey, Kate
Home Robertson, John
Hoon, Geoffrey
Hope, Phil
Hopkins, Kelvin
Howarth, George (Knowsley N)
Howells, Dr Kim
Hoyle, Lindsay
Hughes, Ms Beverley (Stretford)
Hughes, Kevin (Doncaster N)
Humble, Mrs Joan
Hurst, Alan
Hutton, John
Iddon, Dr Brian
Illsley, Eric
Jackson, Ms Glenda (Hampstead)
Jamieson, David
Jenkins, Brian
Johnson, Alan (Hull W & Hessle)
Johnson, Miss Melanie
(Welwyn Hatfield)
Jones, Barry (Alyn & Deeside)
Jones, Helen (Warrington N)
Jones, Ms Jenny
(Wolverh'ton SW)
Jones, Jon Owen (Cardiff C)
Jones, Dr Lynne (Selly Oak)
Kaufman, Rt Hon Gerald
Keen, Alan (Feltham & Heston)
Keen, Ann (Brentford & Isleworth)
Kemp, Fraser
Kennedy, Jane (Wavertree)
Khabra, Piara S
Kidney, David
Kilfoyle, Peter
King, Andy (Rugby & Kenilworth)
King, Ms Oona (Bethnal Green)
Kingham, Ms Tess
Kumar, Dr Ashok
Ladyman, Dr Stephen
Lawrence, Ms Jackie
Laxton, Bob
Lepper, David
Leslie, Christopher
Levitt, Tom
Lewis, Ivan (Bury S)
Linton, Martin
Livingstone, Ken
Lloyd, Tony (Manchester C)
Lock, David
Love, Andrew
McAllion, John
McAvoy, Thomas
McCabe, Steve
McDonagh, Siobhain
Macdonald, Calum
McDonnell, John
McGuire, Mrs Anne
McIsaac, Shona
McKenna, Mrs Rosemary
Mackinlay, Andrew
McNulty, Tony
MacShane, Denis
Mactaggart, Fiona
McWalter, Tony
McWilliam, John
Mahon, Mrs Alice
Mallaber, Judy
Mandelson, Rt Hon Peter
Marsden, Paul (Shrewsbury)
Marshall, David (Shettleston)
Marshall, Jim (Leicester S)
Marshall-Andrews, Robert
Martlew, Eric
Maxton, John
Meale, Alan
Merron, Gillian
Michael, Alun
Michie, Bill (Shef'ld Heeley)
Milburn, Alan
Miller, Andrew
Moffatt, Laura
Moonie, Dr Lewis
Moran, Ms Margaret
Morley, Elliot
Morris, Ms Estelle (B'ham Yardley)
Mountford, Kali
Mudie, George
Mullin, Chris
Murphy, Denis (Wansbeck)
Murphy, Jim (Eastwood)
Naysmith, Dr Doug
Norris, Dan
O'Brien, Mike (N Warks)
O'Hara, Eddie
Osborne, Ms Sandra
Palmer, Dr Nick
Pearson, Ian
Pendry, Tom
Pickthall, Colin
Pike, Peter L
Plaskitt, James
Pollard, Kerry
Pound, Stephen
Powell, Sir Raymond
Prentice, Ms Bridget (Lewisham E)
Prentice, Gordon (Pendle)
Primarolo, Dawn
Prosser, Gwyn
Purchase, Ken
Quinn, Lawrie
Radice, Giles
Rammell, Bill
Rapson, Syd
Raynsford, Nick
Reed, Andrew (Loughborough)
Reid, Rt Hon Dr John (Hamilton N)
Robinson, Geoffrey (Cov'try NW)
Roche, Mrs Barbara
Rooker, Jeff
Rooney, Terry
Ross, Ernie (Dundee W)
Rowlands, Ted
Ruddock, Ms Joan
Russell, Ms Christine (Chester)
Ryan, Ms Joan
Salter, Martin
Savidge, Malcolm
Sawford, Phil
Shaw, Jonathan
Sheerman, Barry
Sheldon, Rt Hon Robert
Shipley, Ms Debra
Simpson, Alan (Nottingham S)
Singh, Marsha
Skinner, Dennis
Smith, Rt Hon Andrew (Oxford E)
Smith, Angela (Basildon)
Smith, Rt Hon Chris (Islington S)
Smith, Miss Geraldine
(Morecambe & Lunesdale)
Smith, Jacqui (Redditch)
Smith, Llew (Blaenau Gwent)
Snape, Peter
Soley, Clive
Southworth, Ms Helen
Spellar, John
Starkey, Dr Phyllis
Steinberg, Gerry
Stevenson, George
Stewart, Ian (Eccles)
Stinchcombe, Paul
Stoate, Dr Howard
Stott, Roger
Strang, Rt Hon Dr Gavin
Straw, Rt Hon Jack
Stringer, Graham
Stuart, Ms Gisela
Sutcliffe, Gerry
Taylor, Rt Hon Mrs Ann
(Dewsbury)
Taylor, Ms Dari (Stockton S)
Taylor, David (NW Leics)
Temple-Morris, Peter
Thomas, Gareth R (Harrow W)
Timms, Stephen
Tipping, Paddy
Touhig, Don
Trickett, Jon
Turner, Dennis (Wolverh'ton SE)
Turner, Dr Desmond (Kemptown)
Turner, Dr George (NW Norfolk)
Twigg, Derek (Halton)
Vaz, Keith
Vis, Dr Rudi
Walley, Ms Joan
Ward, Ms Claire
Wareing, Robert N
Watts, David
Welsh, Andrew
White, Brian
Whitehead, Dr Alan
Wicks, Malcolm
Williams, Rt Hon Alan
(Swansea W)
Williams, Alan W (E Carmarthen)
Wills, Michael
Winnick, David
Winterton, Ms Rosie (Doncaster C)
Wise, Audrey
Worthington, Tony
Wray, James
Wyatt, Derek
Mr. Greg Pope and
Mr. Clive Betts.
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