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20 Jan 2003 : Column 64—continued
Mr. John Bercow (Buckingham): Given that consultation on the Green Paper will inevitably be detailed and will almost certainly prove relatively lengthy—I state that not as a criticism, but simply as an observation of reality—is there any possibility that the right honourable Gentleman will be prepared to consider for the benefit of affected parties the retrospective application of his final proposals?
Mr. McCartney: On retrospection, the honest answer has to be no. However, there are issues about real time. There will be occasions on which wind-ups are not complete, but changes have been made in the wind-up regulations. In such circumstances, a decision has to be made on whether a scheme that has not been fully wound up will be covered by any changes that are made during that time. I am prepared to write to the hon. Gentleman about the matter, as the area is difficult and complex and I do not want to mislead him. I have been firm about the first part of his question and the second is worth looking at. Furthermore, I know that he has raised issues about a particular company. I have a policy to meet hon. Members, from whatever part of the House they come, with regard to issues relating to particular companies. If he wants to avail himself of that policy, I shall be more than happy to concur with his wishes.
Mr. Julian Brazier (Canterbury): Will the Minister give way?
Mr. McCartney: The hon. Gentleman has an opportunity to make a speech, and I could rightly be criticised for giving way far too much. I have given an absolute commitment to the House to return to the matter and I dealt honestly with the two difficult issues that it involves.
We will also consider issues relating to insolvent employers in terms of insurance and centralised clearing house facilities.
Mr. Gardiner: My right hon. Friend said that the priority order might influence what happens to the benefit of pensioners. Does he accept that while the prioritisation of pensioners over debt may lead banks not to foreclose on them so quickly, the fact that debts are down the pecking order might mean that they foreclose earlier on the companies involved?
Mr. McCartney: I said that we were consulting on a number of measures and I did not go out of my way to indicate a preference as to those proposals. The issue must be considered in the Green Paper and large numbers of employees are rightly asking us to consider it. We will consider whatever recommendations arise on the basis of what is said by stakeholders, and I note what my hon. Friend has said.
We are again asking for consultation on insurance issues and the establishment of different funds far better to protect pensioners. We are improving compensation arrangements where schemes become insolvent because of acts of dishonesty—100 per cent. compensation will be provided in such cases—and looking at ways to improve arrangements in respect of underfunded benefit schemes where there is still a solvent employer. We are also looking to protect scheme members where a Government are seeking to define benefit provision, as we want to ensure that employers who want to make changes adequately consult their employees.
On transfer between private companies, we are bringing forward proposals on transfer of undertaking regulations to protect pensions. I was the Department of Trade and Industry Minister who introduced changes in the relevant European directive to protect pensions in public-to-public and public-to-private transfers for the first time in Britain. That will now be the case in respect of private-to-private transfers. I look forward to changes following the end of discussions on the Green Paper.
On renewal of partnerships, we are doing two very important things in the Green Paper. First, we are establishing the pensions commission to deal with a whole range of issues independently of the Government. Key people are stakeholders and all of them have skills and knowledge. The commission is intended to provide in the short term and the medium to long term a source of information that is independent of the Government and the Opposition, while giving them a capacity to ask questions and seek information about pensions issues. It will give advice about issues such as compulsion. The Government have not closed the door as some might suggest in trying to ensure that both state compulsion through national insurance contributions and the voluntary system can work more effectively. We have said that the matter should be considered closely by members of the commission over the next few years.
We will also introduce an employers taskforce, whose membership will, I hope, be announced soon. Its aim is to provide a bridge enabling employers to work with the Government and trade unions to achieve best practice
and innovation and ensure that employees save more for the longer term and that more of them participate in bringing investment into pension schemes.
Lynne Jones: Will the Government also ask the pensions commission to give advice on the interaction between the state pension system and private pensions?
Mr. McCartney: The commission will be working on a programme. First, it will consider statistics on pensions; secondly, it will consider the wider situation. I take note of what my hon. Friend said, as it is important that the commission does effective work. That is exactly the Government's intention in establishing it.
Bob Spink (Castle Point): Will the Minister give way?
Mr. McCartney: No; I want to conclude my speech.
Mr. McCartney: I like the hon. Gentleman dearly and we have spoken over many years. I assure him that next time when I speak in a debate in the House and he is present, I shall give him the first chance at my neck. There is a rash judgment if ever I heard one.
Opposition Members hint and wink about some issues relating to pensioners, giving the impression that they are prepared to consider a consensus. As a consensus and bridge-building politician, I welcome that. [Laughter.] I do not know why there is so much laughter about that, as it is absolutely true.
In the spirit of reconciling Conservative policy with consensus, perhaps the hon. Member for North-East Hertfordshire can give us an insight into the development of his party's policy on pensioners and older people. Only a matter of weeks ago, the hon. Member for Arundel and South Downs (Mr. Flight), shadow Chief Secretary to the Treasury, boldly stated in the 29 December edition of The Sunday Telegraph that, on behalf of the shadow Cabinet, he was
- "digging through current spending, and had found opportunities for cuts".
Let me give some examples of what Conservative policies would mean. The basic state pension would have to decrease by £15.49 for a single pensioner and £24.76 for a pensioner couple. The minimum income guarantee would have to be cut by £20.42 for a single pensioner and £31.16 for couples. That figure could be further reduced. The former Tory leader told the House in 1999 that there was nothing to recommend the minimum income guarantee. It is Conservative policy to eradicate it.
The winter fuel payment would be cut from £200 per pensioner household to £160 or less. The hon. Member for Havant made it clear that he believed that it was a
gimmick and implied that a Conservative Government would drop it. In 2001-02, we spent £16 million on cold weather payments; the Conservative party would slash that figure by £3 million. I could go on about pensioner credit, capital allowance, attendance allowance, bereavement lump sum payments, carer's allowance, TV licences, bus fares and the health and social services budget. The Opposition propose cuts for them all.We require an answer: would the Opposition cut cold weather payments or the home energy efficiency scheme? Would they cut pension credit, which would mean a cut of £400 a year or 20 per cent. across the board? We have invested an additional £2 billion, yet the hon. Member for North-East Hertfordshire has not told us whether the Conservative party will support the introduction of pension credit in April.
The Opposition would reduce capital allowances by £2,400 from the current £12,000 to £9,600. That would fundamentally undermine the concept of pension credit. They would cut attendance allowance by £11.25 a week. That is a disgrace and I hope that the hon. Member for Canterbury (Mr. Brazier), who winds up the debate, gives an absolute assurance that the proposals that the hon. Member for Havant made before Christmas will be scrapped and put in the bin.
6.2 pm
Mr. Steve Webb (Northavon): The subject of our debate is important and it is proper that the Conservative Opposition have chosen to use some of their allocated time for it. It is important to individuals who have been affected and the many who will be affected, although they do not yet know it. Their expectations of a comfortable retirement will be utterly devastated and many of us will have to respond to our constituents by telling them that, as matters stand, nothing can be done for them.
We have all heard of the Allied Steel and Wire case. Although the company would prefer not to be a cause celebre, it has become a classic case of what can go wrong under the current regime. The ASW workers told me that many joined the scheme when it was compulsory. The Minister nods and obviously appreciates the point, which has not been brought out in the debate. Joining the scheme was a condition of employment at ASW.
All hon. Members who supported such legislation or would like to reintroduce compulsion must ask whether the public sector has a responsibility that goes beyond simply saying that perhaps workers can contract back in. Since the law of the land meant that they had to join the schemes, and they did not make a misguided financial decision, perhaps the public sector owes them a greater obligation than has so far been acknowledged.
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