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Lord Rix: That happened to me. I made two telephone calls--one in 1992, just before my heart operation and one in July of last year, during the currency of this Government. I received misleading information from the Benefits Agency in Newcastle. It appears that I have no means of proving that. But the Minister now seems to be saying that the Benefits Agency would have to prove that it had not received the call, rather than the other way round. I assure the Minister that I did make the call; otherwise I should not have entered into the SERPS debate in the first place.

Baroness Hollis of Heigham: I accept entirely that the noble Lord, Lord Rix, did indeed make those calls. I was using that as an example to show how difficult it would be to meet the standard of proof suggested by the noble Baroness, Lady Fookes.

At present, no one has suffered any financial loss as a result of those changes because they do not take effect until April 2000. The Government, including the Minister of State, have made it clear on several occasions that they will consider claims for compensation from individuals who have received incorrect information and have subsequently either acted to their detriment or failed to act to their benefit.

As I said, we are considering which of those two routes is the better to follow or whether there is a third route which we have not yet explored. Several different responses have been given this evening and a variety of other suggestions has been made. But reversing the change, opting to defer it or giving full compensation to people who claim, whether there is evidence or not, that they have been affected or given misleading advice, would produce significant and heavy costs. We cannot take that decision lightly. We are considering the matter carefully and we shall make an announcement in due course. It is no good the noble Lord being indignant with me about bringing information to the Committee. The Government have to make a choice on this extremely expensive issue which involves billions of pounds. The Government will not be rushed into making that decision in order to fit in with the timetable of this or any other Bill. We must do what we believe is right and prudent. We shall make an announcement in due course. On that basis, I ask the noble Lord to withdraw his amendment.

Lord Higgins: I did not move this amendment in any way in a partisan spirit. I accept fully that there have

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been problems with regard to misinformation both under the previous government and under the present Government. It is important that we should debate this matter in that way.

There are two issues: the first is the original change way back in 1986; and the second is the question of bad information being given to individuals who, had they had the right information, might have made different decisions and who have suffered as a result of the bad information they have received.

Lord Rix: I speak from personal experience. Sometimes those bad decisions were taken at the time when it was the law of the land. When I went as secretary-general to Mencap, where pay was not exactly over-generous, I decided to take an early pension. But I did that because at that time, the law of the land said that I would received SERPS and that if I died, my widow would also receive full SERPS. In other words, I took a pension many years before I should have done so on the understanding, as the law was at that time, that my widow would receive a full pension. I took that decision then.

Therefore, it is quite clear that those of us who paid in from 1978 to 1986 were doing so when the law of the land said that our widows would receive full SERPS. I am totally at a loss to understand how the noble Lord's government could overturn that in 1986 or how it could be supported by the present Government at this time. It seems to be a simple matter of contract which is completely overridden by retrospective statute. At the moment a mutual company is in the courts facing a bill for £1.1 billion for trying to argue against the need to pay terminal bonuses which it had contracted to make on certain life pensions. If the court finds against the life company, it will be in exactly the same position as would be this and the previous government if they too found themselves in court today.

Earl Russell: Is the noble Lord, Lord Rix, telling us that this Whitehall farce is not as funny as some others that he can remember?

Lord Rix: Taken as a plot for a Whitehall farce, it might have been seen as totally unacceptable.

10.45 p.m.

Lord Higgins: I am not going down that particular route. There are two issues. The first relates to the initial decision and the second to the wrong information which, it is abundantly clear, was given both under the previous government and the present one. As regards the initial decision, that was debated at the time and Parliament took a view on it. A period of 14 years elapsed before that decision came into effect.

The basic point which the noble Lord, Lord Rix, made in the first part of his intervention a moment ago relates to that decision. His particular amendment is rightly to be discussed separately from this one because he seeks to raise issues other than those I am dealing with now. The noble Baroness will correct me if I am

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wrong, but my understanding is that the Government are in no way proposing to reverse at this stage the decision taken in 1986 as regards basic policy.

The second issue is the action which people failed to take, as the noble Earl pointed out, when receiving wrong information. There again, one must accept that that has happened under both governments. Ultimately, Ministers are held responsible. I leave unasked--I do not expect an answer--what happened to the officials who were responsible. Presumably, in many instances they have retired.

But having discovered that mistakes have been made both by this and the previous government, the question remains as to what it is right to do about it. Clearly, because the deadline is rapidly approaching and is only a matter of a few months away, it is important that a decision should be reached so that people know where they stand.

There are various solutions as regards compensation. The proposal put forward in the amendment tabled by the Liberal Democrats, which it is more appropriate to discuss separately, will be very expensive whereas the cost of my amendment is not clear because we do not know what the Government have in mind.

I put this point in the tone I used for my opening remarks. I do not believe that it is unreasonable to say that if as much information as we are going to receive is now available, Ministers should make up their minds as quickly as possible. My amendment seeks to encourage them to do so. As regards previous amendments to the Tax Credits Bill, the noble Baroness viewed with scepticism my attempts to encourage her to make rapid decisions. There is no reason why a decision should be delayed beyond the date I have suggested in my amendment. The sanction suggested is perhaps not entirely appropriate. We can turn to that at a later stage.

I turn to the question of the records. I am somewhat surprised by what the Minister has said about telephone calls. She will recall that with regard to the problems that arose with the payment of pensions and the breakdown of the department's computer, a number of people telephoned the department. My understanding is that in those circumstances a record is kept of such telephone calls. Am I wrong in recollecting that that is so?

In situations where there is clearly a record in writing, perhaps the department keeps the letters for only six months, but it is likely that those who received letters may have retained letters written more than six months ago. I pay tribute to the fact that the Government in another place, and the Minister in this House, have indicated that they propose to do something about this matter. They are not proposing to say, "Bad luck, that is the end of the matter". They intend to devise a system of compensation. However, I do not understand why there is a problem in devising such a system within a reasonable time-scale, at any rate before 5th April, which is the limit set in the amendment.

As the noble Earl, Lord Russell, pointed out, there are difficulties here. Whether people receive a full widow's pension or half a widow's pension will depend

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arbitrarily on the exact date. That matter would not raise particular problems if they have had 14 years to prepare for such an event, but if not, it will raise problems.

With regard to Amendment No. 73A, the amendment in the name of the noble Lord, Lord Rix, or that tabled by the Liberal Democrat Benches, I hope that it will be possible to press the Government to make a decision that is acceptable to the House. If this is not resolved before the Bill passes, the danger is that the House will not have an opportunity to express a view on what is clearly a highly unsatisfactory situation, on which I make no partisan point. However, we ought to try to resolve it within a reasonable time-scale.

I was hoping that we might have some further response from the Minister. If not, I shall reserve the right to return to this at a later stage. We shall consider the reply given by the Minister, but it seems that simply to say, "Wait and see", when the House will not be in a position to take a view opposite to or different from that of the Government would not be a satisfactory position. Somewhat reluctantly, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 49 [Bereavement payments]:

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