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Mr. Willetts: It is helpful to hear the Secretary of State's estimate—60,000—but will he also give the House some sense of the scale of financial loss, on average, that those people might face?
Mr. Smith: As the House will understand, that is far more difficult. I am not able to give such an estimate, which is part of the ongoing work—the close examination—that I have repeatedly told the House we are undertaking. Our officials are working on it, and when I am able to report more fully to the House, I will do so.
Mr. Hogg: The right hon. Gentleman must know when he will be able to communicate that crucial information to the House, because we cannot decide whether to pay compensation—if it is so called—until we know the sums involved. The right hon. Member for Birkenhead (Mr. Field) knows that, too. So when will we have information on the sums involved?
Mr. Smith: I should like to be able to do more and to say, "Yes, I will be able to make that statement on this date." I am not able to say when I can say that; when I can, I will. I am as anxious to resolve such things as
anyone else, not least because of the real suffering and worry that is afflicting all those affected by this dreadful crisis. No one would want to prolong that for those individuals and their families a moment longer than is necessary. I assure the right hon. and learned Gentleman that we are working to get to the bottom of this as quickly as we can.
Kevin Brennan: In an earlier intervention, the hon. Member for Bournemouth, West (Sir John Butterfill) suggested that there are two flaws in early-day motion 200, the first of which related to whether firms and Governments had said that workers' pensions were guaranteed. The people involved have leaflets from various Governments and company pension schemes on which the word "guarantee" appears. He also said that people had not been compelled, but the early-day motion says:
- "in many cases having been compelled to join their scheme as a condition of employment".
Mr. Smith: My hon. Friend is right: a number of members were compelled to join by their conditions of employment. The hon. Member for Bournemouth, West is also right to say that the Government changed the arrangements in 1986, which took effect in 1988. Of course it can also be argued that no one compelled the employers to include that condition. All those matters must be thought through very carefully before reaching a final judgment on these issues.
Mr. Jim Cunningham: On the issue of compulsion raised by the hon. Member for Bournemouth, West (Sir John Butterfill), is my right hon. Friend aware that many occupational pension schemes included an element of compulsion because they were part of a wage deal? In relation to the point about 1986, there might not have been compulsion, but lots of companies were given tax incentives to encourage people to leave the state earnings-related pension and join private occupational pension schemes.
Mr. Smith: My hon. Friend's points are well made and they further complicate the landscape, but no one would dispute the fact that a large proportion of those schemes' members were obliged to join under their conditions of employment. They were perhaps not even subsequently aware that they could opt out; nor, if they had sought advice at the time, would anyone necessarily have advised them to opt out. We all know that if they had had the good fortune to be in a sound scheme, rather than one that would later go under, they would have done better to stay in that scheme in any event. That gives this issue its particular poignancy, with the difficulties of identifying the challenge that we face and of being clear about what is the right thing to do.
Mr. Frank Field (Birkenhead) (Lab): I apologise for not being here at the beginning of the debate; I was involved in another debate in Westminster Hall. Is not the point that my right hon. Friend is now stressing crucial in two respects? Not only are we trying to represent our constituents, but if we are trying to make
a case for the Government using other funds in compensation, the way in which we ring-fence the group involved is very important. We are talking about a group of people who had to join their occupational pension scheme as a condition of employment, so they are in a different position from me, for example. I voluntarily contributed to Equitable Life, so I could not expect the compensation that, if the Government were able to reach a decision on a compensation scheme, people in other schemes would expect to direct to his door.
Mr. Smith: I take the point that my right hon. Friend makes. He mentions Equitable Life. I should make it clear that that is something on which I have always declared my interest in the register, which is consistent with the advice of the registrar given at the beginning of 2003. The matter is no longer registrable, but it is declarable when raised within my ministerial responsibilities. I have not had any dealings on Equitable Life at the Department for Work and Pensions or the Treasury, and my hon. Friend the Minister for Pensions would have to respond to any points about that.
On the general point that my right hon. Friend makes, when issues of compensation or discretionary assistance—that is not the same thing—are raised, it is important to have a clear idea about how and where boundaries could be placed around those who would be eligible. We continue to examine such matters closely. I take the point behind the argument that he makes, but, equally, there would be those who would say that as a consequence of it, a distinction should be drawn between those who were in such schemes in 1988 and those who joined later. How fair that would seem to people who joined the schemes later and thus did not receive assistance illustrates the problem when drawing boundaries. There are also problems when considering time. Most members of the Maxwell pension scheme, thanks to the rescue plan introduced by Sir John Cuckney with the help of my right hon. Friend and other hon. Members, have received a large proportion of the pensions that they were expecting. As some schemes have not done well, it is not difficult to understand why members who had lost out would knock on the door to ask for assistance and compensation. I mention those points only because my right hon. Friend raised the valid issue of the importance of drawing a boundary and the difficulty of so doing.
Kevin Brennan: When considering that boundary, would it be appropriate to examine whether people were given anything amounting to an adequate health warning about the pension schemes that they joined? Surely it is the case that no rational human beings would bet their retirements on a single share—namely, the share of their employer. People were not told that they were required to do that.
Mr. Smith: I take my hon. Friend's point, but the whole House can appreciate how difficult it could be to establish whether people had received such advice. I am not erecting these problems as excuses for why we are
unable to announce an assistance scheme, but citing them as serious issues that must be thought through before we can reach a final decision.
Rob Marris: At the risk of raising false hopes all over again, is my right hon. Friend saying that he does not rule out compensation and that he is still looking at the issues and statistics?
Mr. Smith: My hon. Friend urges me to repeat that we are not raising false hopes, and I shall have to underline that at some point in my speech. As I have said in the House before, given all these workers' anxieties, which we understand, we must be able to look them in the eye. They must know that we have been absolutely straight with them all along. I say again that we must not raise false hopes, but it would be wrong to close off consideration of these issues until, or unless, we are absolutely certain that nothing can be done. That is the spirit in which I respond to my hon. Friend's point.
Mr. Smith: I shall give way to the hon. Gentleman one last time.
Sir John Butterfill: I was not entirely sure what the right hon. Member for Birkenhead (Mr. Field) said, and I did not want the Secretary of State to get too much comfort if he was inferring, as some of us might have thought, that the Government could have no liability arising out of Equitable Life. When they see fit to publish the Penrose report, we hope that it will be published in full. If it shows that Lord Penrose has decided that there was clear culpable behaviour by the Department of Trade and Industry and, perhaps, the Treasury, will the Government not rule out the fact that their culpability should give rise to compensation?
Mr. Smith: For reasons that I made clear in my declaration a few minutes ago, my hon. Friend the Minister for Pensions will deal with that aspect of the hon. Gentleman's points in his reply to the debate.
I return to the series of questions that the hon. Member for Havant—
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