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Lord Mackay of Ardbrecknish: I thank the noble Baroness for allowing me to intervene. In the list of companies she has read out, I wonder whether she is distinguishing properly between member trustees and member-nominated trustees. That is my first point. The second point I should like to make, having listened to the last few sentences, is that one may perhaps be led to believe that we are going to say that there must be one-third only. In fact, it is a minimum of one-third. So all the companies to which she has pointed and which, I agree, are doing something sensible and splendid for them, can continue to do that. She should not be sounding as if somehow this provision will in any way endanger what the schemes are already doing.

Baroness Hollis of Heigham: I thank the Minister for that intervention, because if it means that he concedes that the amendment is desirable—because that is what the Bill will permit—I welcome him to our side of the Committee. As for the distinction between employee-elected and employee-nominated trustees, no, I am not making that distinction because a number of the major schemes—there may be Members of the Committee who know more about the detail of those companies than I do—draw their people from electoral colleges because their membership base is so large. That would confuse the either/or that the Minister has suggested. I believe that that is the case with ICI, Unilever and Shell.

I should like to repeat the basic point: this is an even-handed amendment which will have two advantages. First, it will not result in the employer acquiring any additional financial responsibilities so far as concerns benefits. As the noble Viscount, Lord Caldecote, asked, once a Bill becomes an Act the employer may still take contribution holidays while the employees continue to make their contributions. That remains unchanged, as does the employer's power to wind up a scheme or to refuse to make any changes that he does not think to be in the company's financial interests. The employer's powers of veto as a long-stop are unaffected by the amendment.

What the amendment will do is to bring up to the best the practices of the weaker schemes. It will provide an even-handed approach which will ensure

13 Feb 1995 : Column 454

that all trustees, wearing their fiduciary duty hats, will seek to deliver the pension promise that we all want. I hope that the Committee will support the amendment.

Baroness Dean of Thornton-le-Fylde: I speak in support of the amendment. I wish to clarify a couple of points that have quite rightly been raised. The first relates to the pensions holiday. There is no law that provides that the employer who takes a contributions holiday has to allow the employee a reduction in contributions or a pensions holiday. There is nothing to stop the trust rules from saying that. There is nothing to stop the trustees agreeing to do that, but in my experience it happens in a minority of cases only.

I have been a trustee of two pension schemes. Both those schemes reduced contributions from the employees when they were in surplus. However, one must bear in mind that over the past half decade a substantial number of schemes have been working in surplus and so a substantial number of employees have been taking pension holidays.

My noble friend Lady Castle talked about her friend who was affected by the Maxwell pension fund. A number of Maxwell pension funds were in surplus. Maxwell did not pay a penny piece in employer's contributions into the very funds he was defrauding of their assets. So the balance is unfair.

The Minister said that there should be a one-third/two-thirds split because that would enable employers to stand behind their schemes. He said that it was in their interests that the schemes should be well run. What about the employees? It is in their interest that a scheme is well run. They are the people who have to pick up the pieces at the end of their working lives if the scheme is short, not the employer. Few employers are in the same scheme as their employees, as we have seen recently with some of the alleged public sector scandals.

As regards the Civil Service, when I was negotiating on behalf of people in HMSO, for instance, I was always made aware during the annual pay negotiations that I should take into account the fact that the payment to the members that I represented included an equivalent 9 per cent. contribution towards their pension. It is totally incorrect to say that a pension is not deferred pay. However, I am a realist. I am also a pragmatist. I have heard the tremendous well of support that the 50:50 rule for trustees has gathered. On that basis, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendment No. 107B not moved.]

Baroness Hollis of Heigham moved Amendment No. 108:

Page 6, line 44, leave out ("one-third") and insert ("one-half").

The noble Baroness said: I wish to test the opinion of the Committee. I beg to move.

4 p.m.

On Question, Whether the said amendment (No. 108) shall be agreed to?

13 Feb 1995 : Column 455

Their Lordships divided: Contents, 116; Not-Contents, 129.

Division No. 1


Acton, L.
Addington, L.
Airedale, L.
Allen of Abbeydale, L.
Archer of Sandwell, L.
Avebury, L.
Barnett, L.
Beaumont of Whitley, L.
Blackstone, B.
Bottomley, L.
Bruce of Donington, L.
Callaghan of Cardiff, L.
Carmichael of Kelvingrove, L.
Carter, L.
Castle of Blackburn, B.
Cledwyn of Penrhos, L.
Clinton-Davis, L.
Darcy (de Knayth), B.
David, B.
Dean of Beswick, L.
Dean of Thornton-le-Fylde, B.
Desai, L.
Diamond, L.
Donaldson of Kingsbridge, L.
Dormand of Easington, L.
Dubs, L.
Eatwell, L.
Elis-Thomas, L.
Ezra, L. [Teller.]
Falkender, B.
Falkland, V.
Farrington of Ribbleton, B.
Fisher of Rednal, B.
Fitt, L.
Foot, L.
Freyberg, L.
Gallacher, L.
Gladwyn, L.
Glenamara, L.
Gould of Potternewton, B.
Graham of Edmonton, L. [Teller.]
Greene of Harrow Weald, L.
Grey, E.
Halsbury, E.
Hamwee, B.
Harris of Greenwich, L.
Haskel, L.
Healey, L.
Hilton of Eggardon, B.
Hollick, L.
Hollis of Heigham, B.
Holme of Cheltenham, L.
Howie of Troon, L.
Hughes, L.
Jacques, L.
Jay of Paddington, B.
Jenkins of Hillhead, L.
Jenkins of Putney, L.
Judd, L.
Kennet, L.
Kinloss, Ly.
Lauderdale, E.
Lawrence, L.
Lester of Herne Hill, L.
Listowel, E.
Lockwood, B.
Longford, E.
Lovell-Davis, L.
Mallalieu, B.
Mason of Barnsley, L.
Mayhew, L.
McCarthy, L.
McIntosh of Haringey, L.
Milne, L.
Milner of Leeds, L.
Molloy, L.
Monkswell, L.
Morris of Castle Morris, L.
Morris of Kenwood, L.
Nicol, B.
Ogmore, L.
Peston, L.
Plant of Highfield, L.
Portsmouth, Bp.
Prys-Davies, L.
Rea, L.
Richard, L.
Richardson, L.
Ritchie of Dundee, L.
Rochester, L.
Rodgers of Quarry Bank, L.
Sainsbury, L.
Seear, B.
Sefton of Garston, L.
Serota, B.
Shaughnessy, L.
Shepherd, L.
Simon, V.
Stallard, L.
Stedman, B.
Stoddart of Swindon, L.
Strabolgi, L.
Taylor of Blackburn, L.
Thomas of Walliswood, B.
Thomson of Monifieth, L.
Thurlow, L.
Tordoff, L.
Turner of Camden, B.
Varley, L.
Wallace of Coslany, L.
Wedderburn of Charlton, L.
White, B.
Wigoder, L.
Williams of Crosby, B.
Williams of Elvel, L.
Winchilsea and Nottingham, E.


Aberdare, L.
Ailsa, M.
Aldington, L.
Ampthill, L.
Archer of Weston-Super-Mare, L.
Astor, V.
Balfour, E.
Belhaven and Stenton, L.
Birdwood, L.
Blaker, L.
Blatch, B.
Blyth, L.
Boardman, L.
Borthwick, L.
Boyd-Carpenter, L.
Brabazon of Tara, L.
Braine of Wheatley, L.
Bridgeman, V.
Brigstocke, B.
Brougham and Vaux, L.
Bruntisfield, L.
Buckinghamshire, E.
Butterworth, L.
Buxton of Alsa, L.
Cadman, L.
Caithness, E.
Campbell of Alloway, L.
Campbell of Croy, L.
Carnegy of Lour, B.
Carnock, L.
Chalker of Wallasey, B.
Charteris of Amisfield, L.
Chelmsford, V.
Clanwilliam, E.
Constantine of Stanmore, L.
Courtown, E.
Cranborne, V. [Lord Privy Seal.]
Crathorne, L.
Cross, V.
Cullen of Ashbourne, L.
Cumberlege, B.
Davidson, V.
De Freyne, L.
Dean of Harptree, L.
Dixon-Smith, L.
Elibank, L.
Ellenborough, L.
Elliott of Morpeth, L.
Elton, L.
Faithfull, B.
Ferrers, E.
Finsberg, L.
Flather, B.
Gainford, L.
Gardner of Parkes, B.
Geddes, L.
Goschen, V.
Gridley, L.
Hacking, L.
Hailsham of Saint Marylebone, L.
Harding of Petherton, L.
Harmar-Nicholls, L.
Hayhoe, L.
Hayter, L.
Henley, L.
Hives, L.
HolmPatrick, L.
Hood, V.
Hooper, B.
Hothfield, L.
Howe, E.
Hylton-Foster, B.
Inglewood, L. [Teller.]
Johnston of Rockport, L.
Kimball, L.
Kinnoull, E.
Lindsay, E.
Lindsey and Abingdon, E.
Long, V.
Lucas, L.
Lyell, L.
Mackay of Ardbrecknish, L.
Mackay of Clashfern, L. [Lord Chancellor.]
Macleod of Borve, B.
Mancroft, L.
Manton, L.
Merrivale, L.
Mersey, V.
Miller of Hendon, B.
Montgomery of Alamein, V.
Mowbray and Stourton, L.
Moyne, L.
Munster, E.
Murton of Lindisfarne, L.
Nelson, E.
Newall, L.
Norrie, L.
Northesk, E.
O'Cathain, B.
Orr-Ewing, L.
Oxfuird, V.
Pender, L.
Peyton of Yeovil, L.
Rankeillour, L.
Rawlings, B.
Rennell, L.
Renwick, L.
Rodger of Earlsferry, L.
Romney, E.
Saltoun of Abernethy, Ly.
Sanderson of Bowden, L.
Seccombe, B.
Shannon, E.
Shaw of Northstead, L.
Skelmersdale, L.
Slim, V.
Soulsby of Swaffham Prior, L.
Strathclyde, L. [Teller.]
Sudeley, L.
Swansea, L.
Terrington, L.
Teviot, L.
Teynham, L.
Thomas of Gwydir, L.
Tugendhat, L.
Ullswater, V.
Vivian, L.
Wynford, L.
Young, B.

Resolved in the negative, and amendment disagreed to accordingly.

13 Feb 1995 : Column 456

4.10 p.m.

Lord Lucas moved Amendment No. 109:

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