Pensions Bill

[back to previous text]

Mr. Pond: The hon. Gentleman's first point, raised by the National Association of Pension Funds, relates to what scheme rescue is. It includes those situations in which the employer can emerge successfully from insolvency proceedings with a scheme intact, or when a purchaser of a business agrees to take over a scheme and protect members' benefits. If, however, the employer's business is to be sold on without the pension scheme being transferred, the pension liabilities will be left behind with the original employer, which is likely to be dissolved or to cease trading, with its creditors, including the pension scheme, paid out of any remaining assets. It will be clear in those circumstances that there is no employer to support the scheme in future and the scheme has not, therefore, been rescued.

Creditors' voluntary liquidation allows an insolvent company to put itself into liquidation and wind up its affairs without the need for a court order. The distinction is between that and members' voluntary liquidation, which allows a solvent company to put itself into liquidation and to wind up its affairs—for example, when no one is left to run a family business.

2.30 pm

In general, members' voluntary liquidations are not included as an insolvency event for the purposes of the PPF as they apply to a solvent form of company wind-up. For example, a company going into members' voluntary liquidation can make a statutory declaration that it will be able to pay all its debts in full, together with interest at the official rate, within a specified period not exceeding 12 months from the date of the commencement of the winding up. However, there are circumstances in which members' voluntary liquidation can be converted into a creditors' voluntary liquidation if it transpires that the debts cannot be paid in full within the specified period. Although clause 95 recognises CVLs—creditors' voluntary liquidations—triggered in the usual way, a

Column Number: 438

resolution is passed for a voluntary winding up of the company without a declaration of solvency.

The Government amendment will ensure that CVLs that occur as a result of a conversion from MVLs—creditors', as opposed to members', voluntary liquidations—are also covered. Members of such schemes are thus able to benefit from PPF protection. As for the hon. Gentleman's third point about the British Chambers of Commerce, I should like to take up his offer and reflect on what he said. We do not want to come up with an answer now that is not the Government's final settlement. Perhaps we can write to him and other members of the Committee about that.

Question put and agreed to.

Clause 96, as amended, ordered to stand part of the Bill.

Clause 97

Board's duty where there is a
failure to comply with section 96

Amendments made: No. 282, in

    clause 97, page 60, line 34, after 'or', insert

    'a qualifying relevant event within the meaning'.

No. 283, in

    clause 97, page 60, line 38, after second 'event', insert

    'or, as the case may be, qualifying relevant event'.—[Mr. Pond.]

Clause 97, as amended, ordered to stand part of the Bill.

Clause 98

Eligible schemes

Mr. Waterson: I beg to move amendment No. 2, in

    clause 98, page 61, line 9, leave out subsection (2).

The Chairman: With this it will be convenient to discuss the following:

Amendment No. 273, in

    clause 98, page 61, line 9, leave out 'not'.

Amendment No. 274, in

    clause 98, page 61, line 9, after 'up', insert

    'or if it has already been wound up.'.

Amendment No. 276, in

    clause 136, page 83, line 46, at end insert—

    '(2A) The regulations must prescribe that the initial levy is not to be used for payments under section 135(3) in so far as they relate to schemes which are being wound up or which have already been wound up on the date prescribed for the purposes of section 98(2).'.

Amendment No. 277, in

    clause 137, page 85, line 11, at end insert—

    '(11) Regulations must make provision that the pension protection levy is not to be used for payments under section 135(3) in so far as they relate to schemes which are being wound up or which have already been wound up on the date prescribed for the purposes of section 98(2).'.

Mr. Waterson: We are about to debate the point that we covered this morning, but we shall approach it from a different direction. Amendment No. 2 would remove subsection (2), which makes it clear that any schemes that are in wind-up before the Bill comes into

Column Number: 439

force are not eligible. I do not want to rehearse our earlier arguments about the 60,000 people who need compensation and who will not be compensated under the Bill because its measures do not have a retrospective effect.

However, the Committee would be surprised if I did not touch in passing on the slightly bizarre result of our Division this morning, whereby Labour Members voted down one of the amendments tabled by the hon. Member for Cardiff, West (Kevin Brennan), while he personally abstained. I hope—as I am sure the 60,000 people do—that that was on the basis that those 60,000 are on a promise that the Government will make some detailed proposals to deal with the problem soon. Tea and sympathy is wearing a bit thin, although at least we have avoided the old mantra about not raising false hopes.

Kevin Brennan (Cardiff, West) (Lab): I abstained because the Government promised to continue considering the issue. I accept that the amendments that I tabled might not technically have achieved what we want to achieve. However, I note that for the first time, Conservative Members voted in favour of using public money to achieve such an end. Does the hon. Gentleman agree that public money should be used to compensate the workers? Is that now his party's policy, as Conservative Members voted for it this morning?

Mr. Waterson: It is said that attack is the best means of defence. The hon. Gentleman must make his own peace with those who inspired his amendments. As for his question, I thought I made my position crystal clear this morning. We are a responsible Opposition—I do not of course include the Liberal Democrats in that—so we will not sign a blank cheque. My position is that simple. However, we think that unclaimed assets provide the answer—[Interruption.] I am sorry that Labour Members find this so exciting. It was the hon. Member for Cardiff, West who took the view that he did not care where the money came from.

Kevin Brennan rose—

Malcolm Wicks: Will the hon. Member for Eastbourne give way?

Mr. Waterson: I will, after I have given way to the hon. Member for Cardiff, West, whose last intervention I am still trying to deal with. It is a luxury of sitting on the Back Benches not to care about where the money comes from. Those of us who sit on the Front Benches have to take a more responsible view, and my party's position could not be simpler. If the hon. Gentleman was reassured by the Government's wind-up speech this morning he is easily satisfied, because it seemed to me that they were still taking the view that they could not compensate people retrospectively; their thinking had not moved forward.

Kevin Brennan: I am happy to confirm to the hon. Gentleman that I stand by what I said: there should be compensation, and I do not mind whether it comes from public funds or another source. He is right to say that I am a Back Bencher—but he sits on the Front

Column Number: 440

Bench and speaks on behalf of his party, and he led his troops to vote for the amendment that called for public funds to be used. I would have thought that that had some meaning in terms of the Conservative party's position. When he voted for that, did he mean it or not?

The Chairman: Order. What we discussed this morning bears a certain resemblance to what we are discussing this afternoon, but I do not want a rerun of this morning's debate.

Mr. Waterson: I will deal quickly with the point that has just been made, and then if the Minister still wants to intervene I will give way.

The hon. Member for Cardiff, West is mixing up two things, as did the Under-Secretary in his summing up this morning. One factor is giving the power to pay compensation to the 60,000 people, which the amendments of the hon. Member for Cardiff, West were primarily about; the other factor is where the money comes from. It is still firmly our position that it should come from unclaimed assets. The Under-Secretary signally failed to give any genuine justification of why, if unclaimed assets are now miraculously available to give to charities, at least some of them—we are talking about a sum that could amount to £15 billion—are not available for his constituents and those of other Members.

Malcolm Wicks: If the Opposition's contention is that the money should come from unclaimed assets—that is a reasonable proposal that can be, and has been, discussed—why did the hon. Gentleman vote this morning that it should come from the taxpayer? Has he discussed that with the Shadow Chancellor?

Mr. Waterson: I am sorry if the Minister has difficulty with our position. It would be infinitely more interesting to the Committee if he had a position on this matter, other than the tired mantra that the Government do not want to raise false hopes. I have made my position abundantly clear this morning, as did the hon. Member for Cardiff, West. I am only sorry that the vote was lost.

Paul Holmes (Chesterfield) (LD): The hon. Gentleman spoke disparagingly about Members who offer tea and sympathy and then back away. Can he clarify what his party's position now is? Is he saying that, as in this morning's vote, he is in favour of providing assistance but only on condition that it comes from unclaimed or orphan assets? Is he therefore saying that if that route proves to be a dead end, all he will offer is tea and sympathy, because he would not provide the funding from any other source? I supported the private Member's Bill introduced by the right hon. Member for Birkenhead (Mr. Field) that would have gone down that route, but Government Whips blocked it.

 
Previous Contents Continue

House of Commons home page Parliament home page House of Lords home page search page enquiries ordering index


©Parliamentary copyright 2004
Prepared 25 March 2004