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Mr. Mike Weir (Angus) (SNP): In the statement, the Secretary of State said that the financial assistance scheme would help up to 15,000 people. However, yesterday, only 27 people had registered for it. Does not that suggest that the scheme is barely scratching the surface of the problem? When the right hon. Gentleman attends one of the national pensions day events on Saturday, what arguments will he deploy to persuade people to take the Government's advice to invest in new occupational pension schemes? The Government are obviously not prepared to take responsibility for the failure of past advice to do so.

Mr. Hutton: I have made it clear that no Government can take responsibility for underwriting the total value of people's private savings. That is impossible and untenable. The pension protection fund and the new powers of the pensions regulator mean that we have a much stronger regulatory environment to deal with the point that Conservative and Liberal Democrat Front
 
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Benchers made about securing confidence in the future. That is essential, and the Government are determined to do that.

Kali Mountford (Colne Valley) (Lab): In my view, ordinary people's typical behaviour when making what they perceive as an ordinary decision in ordinary circumstances is at the heart of the matter. Will my right hon. Friend therefore further consider how those people can be quickly supported through the financial assistance scheme, so that those who are retiring imminently or fairly soon have some assurance about their immediate future? Will he also consider the advice that ordinary people are given in what they perceive to be ordinary circumstances? Will he examine how advice is published—I have asked for that on previous occasions—so that such situations can be avoided in future?

Mr. Hutton: Yes, I agree with my hon. Friend and I can give her that assurance. As part of the review of the financial assistance scheme, we will have to examine the way in which it currently operates—the time it takes to process applications and the interim financial payments that we can make. I am not satisfied that, so far, only 27 people have received payments. My hon. Friend the Minister for Pensions Reform and I are working together to ascertain how we can improve the current administration of the scheme.

Mr. Nigel Dodds (Belfast, North) (DUP): There are many examples of great human tragedy and hardship among the hundreds of people affected by the closure of the company scheme at the Richardson's IFI factory in my constituency. Joe Blair, who was one of the people in the four cases that were taken to the ombudsman, feels that he has been doubly robbed. He lost his pension and now the Government have rejected and attacked the ombudsman's report in a cavalier way. What does the Secretary of State say to Joe Blair and the many others whose health and families have been affected, and who look to the future with despair as a result of what has happened to them?

Mr. Hutton: We have considered the ombudsman's report carefully. It is the first time in more than 40 years that my Department has taken such a view of an ombudsman's report. We have not done that lightly or in a cavalier way, as the hon. Gentleman suggested. I can only reiterate the points that I have tried to make repeatedly about the existence of the financial assistance scheme, the reasons for setting it up and the group of people whom we wanted it to help at the beginning of its operations—those in the greatest need and closest to retirement who cannot make alternative financial arrangements. I have made it repeatedly clear that we are taking a further longer look at the financial assistance scheme and I hope to present proposals as soon as possible.

Richard Burden (Birmingham, Northfield) (Lab): I welcome my right hon. Friend's restatement of his willingness to review the financial assistance scheme. For my constituents who are workers or former workers
 
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at Kalamazoo, time is of the essence. Given the current timetable for the comprehensive spending review, it may leave many people in appalling positions. Will he therefore say a little more about the possibility of expediting the review? Given that the situation requires substantial amounts of money, will he speak to appropriate firms and bodies in the financial sector to ascertain whether, even at this late stage, there may be mileage in considering not purchasing annuities and pooling the schemes' assets to ensure that money can be front-loaded and the cost spread over the maximum period?

Mr. Hutton: On the first point, I do not want to sound repetitive, but we recognise that time is of the essence. That is why my right hon. Friend the Prime Minister announced yesterday that we would expedite the review of the financial assistance scheme. I hope to present proposals as soon as that work has been completed.

My hon. Friend's last point is important and many of the delegations that I have met have raised it with me. If we took his advice—

Mr. Deputy Speaker: Order. It would help if the Secretary of State addressed the House or, at least, his microphone, partly through courtesy but also because not doing so makes it difficult for others to hear.

Mr. Hutton: My apologies, Mr. Deputy Speaker. Everyone is probably fed up to the back teeth with hearing from me this afternoon.

There is a significant problem with taking my hon. Friend's advice about dropping the requirement to purchase an annuity. If we dropped it, there is clearly the potential for creating problems further on because it is inevitable that the remaining pension schemes would rapidly run out of resources. It is neither fair nor reasonable for us to do that. That is why the requirements are what they are.

Steve Webb (Northavon) (LD): The Secretary of State appears to say one of two things: either the ombudsman is ill informed and has not done a proper job, or she is well informed but her views are irrelevant. Which is it?

Mr. Hutton: The ombudsman has prepared a thorough report and reached conclusions. We disagree with them.

Mr. Jim Cunningham (Coventry, South) (Lab): May I reinforce the point that the Secretary of State should examine the position with some urgency to help people, some of whom are in serious predicaments? People from, for example, Federal-Mogul in Coventry, are waiting for the outcome. So far, we have discussed the ombudsman's report, but should we not hold a proper inquiry into where the money that was invested went and who spent it?

Mr. Hutton: I agree with my hon. Friend. It is important to expedite the review of the financial assistance scheme and I look forward to discussing that with him.

Mr. Paul Goodman (Wycombe) (Con): Since 1995, public sector pensions, including ours and Ministers'
 
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pensions, have become relatively more secure, but private sector pensions—partly because of the £45 billion tax on pension funds—have got relatively less secure. Given that context, does not the Secretary of State acknowledge that my constituents and others will greet with incredulity the Government's overriding the judge's verdict on maladministration?

Mr. Hutton: I have already made it clear that the £45 billion figure is rubbish. On the hon. Gentleman's point about the security of defined benefit schemes, I remind him of the Pensions Act 2004, which will significantly improve matters in ways that I am sure he would like.

Mr. Frank Doran (Aberdeen, North) (Lab): I welcome my right hon. Friend's statement and especially his commitment to reviewing the financial assistance scheme. In my constituency, nearly 1,000 members of the Richards pension fund managed to be admitted to the scheme, but that has not removed the deep uncertainty, which has been with them for a long time—since the first rumours circulated about the state of the pension fund through to its closure, and then the fears about whether they would get into the scheme. It will be several years before my constituents will be without uncertainty. I hope that my right hon. Friend views that as a matter of urgency and will thus bring not only clarity but certainty to the thousands of pensioners who are affected.

Mr. Hutton: I fully understand my hon. Friend's concerns and those of his constituents. That is precisely why we are expediting the review of the financial assistance scheme.

Mr. Richard Shepherd (Aldridge-Brownhills) (Con): As the Secretary of State knows, based on a recommendation by the Government Actuary, the national insurance fund is required to retain a balance that is equivalent to one sixth of annual expenditure. That would equate to £9.5 billion in 2004. The balance actually held amounted to £29 billion. The Government Actuary reported that that balance will reach £60 billion by 2010—an average increase of between £5 billion and £6 billion a year. The funds are available to meet the ombudsman's recommendations and it is an important point of principle that the Government should consider fulfilling in full the obligations that she set out.

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