House of Commons

Session 2006-07 Publications on the internet Bill Home Page

Notices of Amendments

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given on

Thursday 8th February 2007

Consideration of Bill

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Pensions Bill, As Amended

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Mr Nigel Waterson
Andrew Selous
Mr Mark Lancaster
John Penrose
Mark Pritchard

1

Page 6, line 21 [Clause 5], leave out from ‘shall’ to end of line 22 and insert ‘determine the general level of earnings as set out in subsections (8A).

(8A) If the average earnings index (including bonuses) for the whole economy for September in any year is higher than the index for the previous September, the Secretary of State shall as soon as practicable make an order in relation to each sum mentioned in subsection (1), increasing each sum, if the new index is higher, by the same percentage as the amount of the increase of the index.’.

Mr Nigel Waterson
Andrew Selous
Mr Mark Lancaster
John Penrose
Mark Pritchard

2

Page 7, line 10 [Clause 5], at end insert—

‘(6A) The Secretary if State must, on or before 5th April 2009, announce his decision as to the date from which he will implement the provision set out in this section.’.

Pension forecasts

Mr Nigel Waterson
Andrew Selous
Mr Mark Lancaster
John Penrose
Mark Pritchard

NC1

To move the following Clause:—

‘The Secretary of State shall publish estimates, no later than 1st April 2008, of how many people he expects to receive less than £135 per week in Basic State Pension and Second State Pension combined in 2030 and 2050.’.

Report by Government Actuary on trends in longevity

Mr Nigel Waterson
Andrew Selous
Mr Mark Lancaster
John Penrose
Mark Pritchard

NC2

To move the following Clause:—

‘(1) Beginning in April 2014, the Government Actuary shall present a Report to Parliament every five years setting out the latest evidence on trends in longevity.

(2) It shall be the duty of the Secretary of State to make a motion in the House of Commons in relation to any report under subsection (1).’.

Uprating of pensions for pensioners living overseas

Mr Nigel Waterson
Andrew Selous
Mr Mark Lancaster
John Penrose
Mark Pritchard

NC3

To move the following Clause:—

‘The Secretary of State shall, within three months of the coming into force of this Act, make an oral statement to Parliament as to—

(a) the numbers and locations of UK pensioners living overseas who are in receipt of the basic state pension;

(b) his estimate of the net cost of annually uprating such pensions in future years; and

(c) the state of negotiations with any of those countries with which the United Kingdom does not currently have reciprocal arrangements for the annual uprating of pensions.’.

Report on older workers not paying or being credited with National Insurance contributions

Mr Nigel Waterson
Andrew Selous
Mr Mark Lancaster
John Penrose
Mark Pritchard

NC4

To move the following Clause:—

‘The Secretary of State shall present a report annually to the House of Commons—

(a) analysing, by local authority area and by job sector, the number and distribution of people over 60 seeking work and not being credited with contribution credits, and

(b) on the training opportunities for people seeking to increase the number of their qualifying years for receipt of a full Basic State Pension.’.

Review of the abolition of contracting-out for defined contribution pensions schemes

Mr Nigel Waterson
Andrew Selous
Mr Mark Lancaster
John Penrose
Mark Pritchard

NC5

To move the following Clause:—

‘(1) The Secretary of State shall make a statement to Parliament in each financial year after 6th April 2010 on the use of the revenue that would previously have been assigned to contracted-out rebates for defined contribution schemes.

(2) For the purposes of subsection (1) above, the statement shall cover the extent to which the revenue is assigned to promoting saving.’.

Application of Freedom of Information Act to Personal Accounts Delivery Authority

Mr Nigel Waterson
Andrew Selous
Mr Mark Lancaster
John Penrose
Mark Pritchard

NC6

To move the following Clause:—

‘(1) The Freedom of Information Act 2000 (c. 36) is amended as follows.

(2) In section 35 (formulation of government policy etc.) insert after subsection (2)—

“(2A) Information held by or provided by the Personal Accounts Delivery Authority is not to be regarded—

(a) for the purposes of subsection (1)(a), as relating to the formulation or development of government policy, or

(b) for the purposes of subsection (1)(b), as relating to Ministerial communications.”

(3) In section 36 (prejudice to effective conduct of public affairs) insert after subsection (2)—

“(2A) Information held by or provided by the Personal Accounts Delivery Authority is not to be regarded—

(a) for the purposes of subsection (2)(a), as relating to the maintenance of the convention of the collective responsibility of Ministers of the Crown, or

(b) for the purposes of subsection (2)(b), as relating to the free and frank provision of advice, or the free and frank exchange of views for the purposes of deliberation; or

(c) for the purposes of subsection (2)(c), as relating to the effective conduct of public affairs.”.’.

Performance of the Personal Accounts Delivery Authority

Mr Nigel Waterson
Andrew Selous
Mr Mark Lancaster
John Penrose
Mark Pritchard

NC7

To move the following Clause:—

‘(1) In discharging its functions under this Part of the Act, the Authority shall ensure that its actions and advice support the following objectives for the scheme—

(a) ensuring that the overall outcome, taking account of the impact on the existing market, is an increase in the number of people saving and the overall amount being saved;

(b) optimising levels of participation and contribution among the target group;

(c) setting an investment strategy in the best interests of members;

(d) minimising burdens on employers;

(e) minimising the impact on other high-quality pension provision;

(f) assuring security of administration;

(g) governing in the best interests of members and beneficiaries;

(h) ensuring that the board acts impartially, prudently, responsibly and honestly;

(i) delivering appropriate levels of choice;

(j) achieving charges that are fair and reasonable;

(k) ensuring the funds are invested in the best interests of the members.

(2) Her Majesty may from time to time by Order in Council make provision for amending the objectives set out in subsection (1).

(3) No recommendation shall be made to Her Majesty to make an Order in Council under subsection (2) above unless a draft of the Order has been approved by resolution of each House of Parliament.’.

Mr Nigel Waterson
Andrew Selous
Mr Mark Lancaster
John Penrose
Mark Pritchard

3

Page 22, line 6 [Clause 19], at end insert—

‘(7A) Before issuing guidance under subsection (6) the Secretary of State shall consult—

(a) the Authority;

(b) organisations appearing to him to be representative of consumers;

(c) organisations appearing to him to be representative of employees;

(d) organisations appearing to him to be representative of employers;

(e) organisations appearing to him to be representative of the financial services industry;

(f) such other persons as the Secretary of State considers it appropriate to consult in relation to the guidance.

(7B) A draft of any guidance proposed to be issued under this section shall be laid before each House of Parliament.

(7C) Guidance shall not be issued under this section until after the period of forty days beginning with—

(a) the day on which the draft is laid before each House of Parliament; or

(b) if the draft is laid before the House of Lords on one day and the House of Commons on another, the later of those two days.

(7D) If, before the end of that period, either House resolves that the guidance should not be issued, the Secretary of State must not issue it.

(7E) In reckoning any period of forty days for the purposes of subsection (7C) or (7D), no account shall be taken of any time during which—

(a) Parliament is dissolved or prorogued, or

(b) both Houses are adjourned for more than four days.

(7F) The Secretary of State shall arrange for any guidance issued under this section to be published in such manner as he considers appropriate.’.

Trends in longevity

Mr Nigel Waterson
Andrew Selous
Mr Mark Lancaster
John Penrose
Mark Pritchard

NC8

To move the following Clause:—

‘(1) Beginning in April 2014, the Government Actuary shall present a Report to Parliament every five years setting out the latest evidence on trends in longevity.

(2) It shall be the duty of the Secretary of State to make a motion in the House of Commons in relation to any report under subsection (1).’.

Pension Credit

Mr Nigel Waterson
Andrew Selous
Mr Mark Lancaster
John Penrose
Mark Pritchard

NC9

To move the following Clause:—

‘(1) The Secretary of State may from time to time, and shall when required by subsection (2), lay before each House of Parliament a report on—

(a) current rates and coverage of pension credit entitlement;

(b) likely future rates of pension credit entitlement; and

(c) such other matters as he considers to be relevant as affecting the present and future take-up of and eligibility for pension credit.

(2) The Secretary of State shall lay such reports—

(a) five years after the coming into force of Part I of this Act, and

(b) thereafter at intervals of not more than five years.’.

Contracted-out rebates

Mr Nigel Waterson
Andrew Selous
Mr Mark Lancaster
John Penrose
Mark Pritchard

NC10

To move the following Clause:—

‘(1) The Secretary of State shall make a statement to Parliament in each financial year after 6th April 2010 on the use of the revenue that would previously have been assigned to contracted-out rebates for defined contribution schemes.

(2) For the purposes of subsection (1) above, the statement shall cover the extent to which the revenue is assigned to promoting saving.’.

Financial Assistance Scheme

Mr Nigel Waterson
Andrew Selous
Mr Mark Lancaster
John Penrose
Mark Pritchard

NC11

To move the following Clause:—

‘(1) The Secretary of State shall commission an independent review of the Financial Assistance Scheme having regard (among other things) to—

(a) the efficiency and cost effectiveness of its administration;

(b) whether it could be more effective if administered by the staff of the Pension Protection Fund;

(c) whether it is adequately financed;

(d) what other sources of finance could be made available, including but not limited to unclaimed assets;

(e) whether it should be engaged in the purchase of bulk annuities.

(2) The Secretary of State shall publish the findings of such review within six months of this Act coming into force.’.

Retirement Income Funds

Mr Nigel Waterson
Andrew Selous
Mr Mark Lancaster
John Penrose
Mark Pritchard

NC12

To move the following Clause:—

‘(1) The Finance Act 2004 (c. 12) is amended as follows.

(2) After section 152 (meaning of “arrangement”), insert—

“152A Meaning of ‘Retirement Income Fund’

(1) In this Part, a Retirement Income Fund means a scheme for the reinvestment of savings in retirement which—

(a) is operated by or on behalf of a person authorised to operate a registered pension scheme,

(b) is a scheme in which investments are approved by the Inland Revenue, and

(c) meets the conditions set out in subsections (2) to (9).

(2) The first condition is that, subject to the other conditions in this section, funds held in the Retirement Income Fund may be invested and withdrawn by the member as and when he elects.

(3) The second condition is that an authorised Retirement Income Fund provider must set an annual maximum withdrawal allowance for each member, based on an assessment of each member’s life expectancy, and a member’s withdrawals from the fund in any one year must not exceed that allowance.

(4) The third condition is that, in setting annual maximum withdrawal allowances, an authorised provider must ensure that no member’s total future annual income falls below the Minimum Retirement Income level (as set under section [Minimum Retirement Income] of the Pensions Act 2007) except in the circumstances provided for in the sixth condition.

(5) The fourth condition is that an authorised provider must set an annual minimum withdrawal allowance so that each member’s total income is at least equivalent to the Minimum Retirement Income level, except in the circumstances provided for in the sixth condition.

(6) The fifth condition is that if a member chooses not to declare his total annual income to the authorised provider he must withdraw funds equivalent to the level of the Minimum Retirement Income level or his annual maximum withdrawal allowance, whichever is the lower.

(7) The sixth condition is that, where there are insufficient funds to enable the annual minimum withdrawal allowance to be set so that a member’s total income is at least equivalent to the Minimum Retirement Income level, the allowance should be set at the highest level consistent with the assessment of the member’s life expectancy.

(8) The seventh condition is that the maximum and minimum withdrawal allowances must be set at the same level if a member’s total annual income, including his maximum withdrawal allowance, is lower than the Minimum Retirement Income level.

(9) The eighth condition is that a Retirement Income Fund, and any income derived from it, must not be capable of assignment or surrender by the member.”.’.

Amendment of pension rules

Mr Nigel Waterson
Andrew Selous
Mr Mark Lancaster
John Penrose
Mark Pritchard

NC13

To move the following Clause:—

‘(1) Section 165 of the Finance Act 2004 (c. 12) (pension rules) is amended as follows.

(2) In subsection (1) (which sets out the pension rules)—

(a) in Pension Rule 4, after paragraph (a), insert—

“(aa) a withdrawal from a Retirement Income Fund,”;

(b) in Pension Rule 4, after the second appearance of the words “scheme pension”, insert the words “a withdrawal from a Retirement Income Fund”;

(c) in Pension Rule 6, after paragraph (a), insert—

“(aa) a withdrawal from a Retirement Income Fund,”;

(d) in Pension Rule 6, after the second appearance of the words “scheme pension”, insert the words “a withdrawal from a Retirement Income Fund”.’.

Minimum Retirement Income

Mr Nigel Waterson
Andrew Selous
Mr Mark Lancaster
John Penrose
Mark Pritchard

NC14

To move the following Clause:—

‘(1) The amount of the Minimum Retirement Income in respect of each tax year shall be set by the Chancellor of the Exchequer by order at the level of the standard minimum guarantee prescribed under section 2 of the State Pension Credit Act 2002 (c. 16).

(2) Before making an order under subsection (1), the Chancellor of the Exchequer shall consult such persons as he considers appropriate.

(3) An order under this section (other than the order that applies to the first tax year during which this section is in force) must be made on or before 31st January of the tax year before the tax year to which the order applies.’.

Removal of age limit for annuity protection lump sum death benefit

Mr Nigel Waterson
Andrew Selous
Mr Mark Lancaster
John Penrose
Mark Pritchard

NC15

To move the following Clause:—

‘(1) Schedule 29 to the Finance Act 2004 (c. 12) is amended as follows.

(2) In paragraph 16(1) (definition of annuity protection lump sum death benefit), paragraph (a) shall cease to have effect.’.

Report on contribution credits

Mr Nigel Waterson
Andrew Selous
Mr Mark Lancaster
John Penrose
Mark Pritchard

NC16

To move the following Clause:—

‘The Secretary of State shall present a report annually to the House of Commons on—

(a) the number of carers in receipt of contribution credits;

(b) the number of carers caring for 20 or more hours per week who are not in receipt of contribution credits;

(c) the associated costs of contribution credits to the National Insurance Fund of (a);

(d) an estimate of the cost of providing contribution credits to persons falling within paragraph (b), and

(e) any proposals he may have for reviewing eligibility for contributions credits.’.

Deferral of claim to Basic State Pension

Mr David Laws
Lorely Burt
Danny Alexander

NC17

To move the following Clause:—

‘The Secretary of State shall, no later than 31st December 2007, publish proposals as to how the Government will enable those people who have reached the state pension age and not made the necessary National Insurance contributions or accrued the necessary credits for entitlement to the full Basic State Pension, to defer claiming the Basic State Pension and continue to pay National Insurance contributions until the entitlement to a full Basic State Pension has been accrued.’.

Mr David Laws
Lorely Burt
Danny Alexander

4

Page 6, line 2 [Clause 5], at end insert ‘; or by a percentage not less than the percentage by which the general level of prices is greater at the end of the period than it was at the beginning, whichever is the higher.’.

Mr David Laws
Lorely Burt
Danny Alexander

5

Page 6, line 5 [Clause 5], at end insert—

‘(3A) The general level of earnings shall be defined as the Average Earnings Index (with bonuses).’.

Mr David Laws
Lorely Burt
Danny Alexander

6

Page 6, line 5 [Clause 5], at end insert—

(3A) The general level of prices shall be defined as the Retail Prices Index.’.

Mr David Laws
Lorely Burt
Danny Alexander

7

Page 21, line 28 [Clause 19], at end insert—

‘(2A) In discharging its functions under this Part, the Authority shall publish no later than 1st December 2007—

(a) estimates of the percentage of those people without existing occupational or personal pension provision who would be subject to means-testing if enrolled in personal accounts;

(b) estimates of the percentage of people who will be auto-enrolled into personal accounts who can be expected to secure returns of—

(i) £2 or more for every £1 saved,

(ii) £1 or more for every £1 saved,

(iii) less than £1 for every £1 saved;

(c) a breakdown of the target groups for personal accounts that are most at risk of low returns on their savings;

(d) plans how generic financial advice will be delivered to those people who are liable to be auto-enrolled in personal accounts.’.

Mr David Laws
Lorely Burt
Danny Alexander
John McDonnell
Kelvin Hopkins
Ms Katy Clark
Total signatories: 10

Mr Austin Mitchell Mrs Linda Riordan Mrs Ann Cryer

Mr Neil Gerrard

8

Page 7, line 3 [Clause 5], leave out from ‘means’ to end of line 10 and insert ‘the tax year 2007-2008’.

Carers’ Credit

Mr David Laws
Lorely Burt
Danny Alexander

NC18

To move the following Clause:—

‘The Secretary of State shall, no later than 31st December 2007, publish plans for the extension of carers’ credit to all those involved in caring for over 20 hours a week.’.

Prepared: 9 February 2007