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Iraq and Iran: Stability Talks
3.31 pm
Baroness Williams of Crosby asked Her Majesty’s Government:
Baroness Royall of Blaisdon: My Lords, we welcome the fact that the US and Iranian ambassadors to Iraq and Iraqi government representatives met on 28 May in Baghdad. Her Majesty’s Government were not represented at the meeting, so it would not be appropriate for us to characterise the outcomes. However, we have impressed on Iran bilaterally that a stable and secure Iraq is in the interests of all its neighbours, and that Iran should desist from activities which undermine that objective.
Baroness Williams of Crosby: My Lords, I thank the Minister for her reply. I simply remind the House that that meeting, which took place during the parliamentary Recess, was the first direct, open meeting held between the two countries at a senior level for 48 years. Importantly, they both agreed that they wanted to see a stable, secure and democratic Iraq. First, do Her Majesty’s Government welcome the suggestion put forward by the Iranian side that there should be a continuation of that trialogue between Iraq, Iran and the United States over the forthcoming months and years? Secondly, does the Minister agree that it is important for both the United States and Iran to desist from activities that upset and lead to distrust on the part of the other country?
Baroness Royall of Blaisdon: My Lords, on the first question, the organisation of future meetings is, of course, for the parties concerned. However, Her Majesty’s Government would welcome any future contact between the three parties, because we believe that it is important to engage in dialogue and that it is the best way of bringing about a secure situation in Iraq. On the second question, we want all countries, be they neighbours or those active in Iraq, to desist from any actions that destabilise that country or the region itself.
Lord Corbett of Castle Vale: My Lords, would not one of the best contributions to stabilising Iraq be to persuade the Iranians to stop paying 32,000 Iraqi citizens to do their bidding and to stop arming, training and financing insurgent and terrorist groups in Iraq?
Baroness Royall of Blaisdon: My Lords, my noble friend is quite right. On every occasion when we meet the Iranians, at every level, we ask them to desist from those actions. The best way to bring about a secure Iraq is to stop outsiders arming insurgents inside Iraq. We have to bring about a secure Iraq to ensure the stability of the region as a whole.
Lord Dykes: My Lords, the Minister sounds rather complacent. In view of the fact that America’s military blunders in Iraq are getting worse and worse, in an already severely damaged country—with or without Iranian involvement—what is the next step for the Americans if the surge does not work?
Baroness Royall of Blaisdon: My Lords, I am not complacent; neither are the Government complacent at all where Iraq is concerned. We are working in Iraq to bring about a secure situation. What the Americans do in Iraq is, of course, of extreme importance, but that is the policy of the American Government and not the policy of this Government. We work together; we are coalition partners; however, we both have separate policies that interject.
Lord Howell of Guildford: My Lords, it would be good if this dialogue becomes a trialogue and continues, as the noble Baroness, Lady Williams of Crosby, has suggested, on the simple principle that to jaw-jaw is very much better than to war-war. Has the Minister had reports—obviously second-hand—about any discussion of Iran’s nuclear ambitions? Is that linked with what, according to the Americans, Iran can or cannot do to reduce the tensions in Iraq? These two matters seem tangled up in American minds. Does she have any light to throw on that division of views?
Baroness Royall of Blaisdon: My Lords, we understand that the sole subject discussed at the meeting was the security of Iraq.
Lord Hylton: My Lords, is it the Government’s policy to involve Syria in the stabilisation of Iraq? Can the Minister give any good news on improvements regarding Iraqi refugees in Syria and Jordan?
Baroness Royall of Blaisdon: My Lords, we support strong bilateral relations between Iraq and all its neighbours, including Syria and Iran. We welcome the recent neighbourhood conference which took place in Iraq in May. We hope that that will provide a platform to build on. I do not have the figures or information to hand about refugees in Syria, but I will write to the noble Lord.
Lord Anderson of Swansea: My Lords, clearly Iran is the regional superpower after the invasion and can use that power for good or for ill. Is it the Government’s view that Iran, although there may be short-term temptations, is prepared to see that in the longer term it has an interest in the unity and stability of Iraq? Is it prepared to disaggregate Iraq from the other pressing problems—nuclear, Lebanon and so on—which affect it?
Baroness Royall of Blaisdon: My Lords, when we have discussions with Iran, obviously Her Majesty’s Government at every level discusses all the issues which are pertinent to our relationship. These include Iraq, stability of the region and the nuclear issue. I assure my noble friend that we now speak to Iran quite regularly on Iraq.
Standing Orders (Public Business)
3.37 pm
The Lord President of the Council (Baroness Amos): My Lords, I beg to move the Motion standing in my name on the Order Paper.
Moved, that the Standing Orders relating to public business be amended as follows:
(Questions for written answer)
At end leave out “it may be given on any sitting day including that on which the Question is handed in”.—(Baroness Amos.)
On Question, Motion agreed to.
Delegated Powers and Regulatory Reform Committee
The Chairman of Committees (Lord Brabazon of Tara): My Lords, I beg to move the Motion standing in my name on the Order Paper.
Moved, That Lord Boyd of Duncansby be appointed a member of the Select Committee in the place of Lord Acton, resigned.—(The Chairman of Committees.)
On Question, Motion agreed to.
Pensions Bill
3.39 pm
The Parliamentary Under-Secretary of State, Department for Work and Pensions (Lord McKenzie of Luton): My Lords, I beg to move that the House do now again resolve itself into Committee on this Bill.
Moved accordingly, and, on Question, Motion agreed to.
House in Committee accordingly.
[The LORD SPEAKER in the Chair.]
Clause 15 [Abolition of contracting-out for defined contribution pension schemes]:
Lord McKenzie of Luton: moved Amendment No. 49:
The noble Lord said: I shall also speak to the other amendments in the group. The amendments deal in particular with the treatment of the protected rights that members of contracted-out defined contribution schemes would have built up before contracting out on a defined contribution basis is abolished.
I should explain a little about contracting out and protected rights. We were going to hear about contracting out in defined benefit schemes. Clause 15, Schedule 4 and these amendments deal with contracting out in defined contribution schemes, also known as money purchase schemes. Contracting out allows people to opt out of the state second pension by saving in a private pension scheme instead. Those who contract out forego some or all of their rights in the state second pension scheme. In return, they receive a rebate of national insurance contributions.
In a defined contribution scheme, the national insurance rebate for contracting out, together with any associated tax relief, is invested in the person’s pension scheme. That amount and its investment return are known as protected rights, and certain rules apply to those rights. They can be invested only in certain specified products. They may be transferred only to schemes that are contracting out, and annuities purchased with the protected rights must be calculated on a unisex basis. In particular, protected rights must provide for a survivor benefit if a scheme member is married or a civil partner at the time that an annuity is purchased.
The Government acknowledge that, because the protected rights rules do not apply to any other rights held in a person's pension pot, the separate tracking of protected rights can complicate scheme administration and restrict flexibility for members. In order to simplify matters, we want to remove as many of those rules as possible, but we need carefully to consider the potential impact, especially on women, of removing the rule requiring a provision of a survivor benefit. That is because such removal could result in a survivor not receiving a pension from either the private pension scheme or the state second pension.
In another place, the Bill was amended to insert a power to abolish or vary by regulations the rules applying to protected rights. The Government's intention was to take decisions on the use of that power in the light of the findings of the joint DWP/Treasury review of the open market option for annuities. One of the fundamental aims of that review is to ensure that people make informed choices about their annuity type and fully understand the consequences of their choice. In particular, it will consider the provision of joint life annuities.
However, the Delegated Powers and Regulatory Reform Committee considered that changes to the rules on protected rights were too significant for a regulation-making power. It recommended that the changes be included in a future Bill, once decisions on the policy had been made. I have written to the committee accepting its recommendation. As a result, the amendments will remove the delegated power in line with the committee's recommendation. At the same time, the amendments remove all the rules that apply to protected rights, except for the provisions concerning survivors. The consequence of those changes is that protected rights will be treated in the same way as non-protected rights when being invested or transferred.
Furthermore, at the point of annuitisation, members will no longer be required to purchase a unisex annuity. Unisex annuities are not required, or indeed generally provided, for non-protected rights. That change means that in future those who are not married or in a civil partnership will be able to buy just one annuity with their protected and non-protected rights. That will bring about some simplification for schemes and members. We acknowledge, however, that further simplification could be achieved by removing the rules on survivor benefits.
I am sure that the Committee will agree that it is right to consider the question of survivor benefits in greater depth and that a decision on protected rights and survivors must await the outcome of the review of the working of the open market option for annuities. When that decision is taken, any changes to legislation will be placed in a future Bill to allow a full discussion.
Contracting out is a complex matter which has given rise to many legislative provisions with multiple cross-references. In order to achieve the abolition of contracting out on a defined contribution basis, a number of amendments and repeals are being made to existing legislation by virtue of Clause 15 and Schedule 4. The minor and technical changes in this group of amendments allow cross-references to the provisions that are being amended or repealed to be corrected in other legislative provisions.
Amendment No. 54, in the name of the noble Lord, Lord Skelmersdale, seeks to remove all the protected rights rules, although I understand that he may not move it. As I have said, our amendments abolish most of the rules, but they will preserve the rule that requires the purchase of a joint-life annuity if the scheme member is married or in a civil partnership at the point of annuitisation. The Government acknowledge that the removal of this remaining rule would further simplify the schemes for members, but we believe that such an important matter must be looked at in greater depth before that decision is taken. I beg to move.
3.45 pm
Lord Skelmersdale: I tabled Amendment No. 54 in the spirit of inquiry to elicit the sort of information that the Minister has just given. I accept that, at this stage in the proceedings, it goes a trifle too far, but something of the remainder of that paragraph in Schedule 4 may well be found in the next pensions Bill. Anyone would think that there had been some collusion between the Minister and me, as we are in perfect agreement on this point. I assure the Committee that there has been no such collusion. When the time comes, I shall not move Amendment No. 54.
Lord Oakeshott of Seagrove Bay: Far be it from me to join this genuine or implied collusion. I am sure there is none, but I will leave it to the Minister and the noble Lord.
On Question, amendment agreed to.
Lord McKenzie of Luton moved Amendments Nos. 50 to 52:
Clause 15, page 19, line 21, at end insert “(but any power to make regulations conferred by those amendments may be exercised at any time so as to make regulations having effect as from the abolition date)”
On Question, amendments agreed to.
Clause 15, as amended, agreed to.
Schedule 4 [Abolition of contracting-out for defined contribution pension schemes]:
Lord McKenzie of Luton moved Amendment No. 53:
“In section 20 (transfer of accrued rights) in subsection (3) (regulations may provide for certain provisions to have effect subject to modifications) for “sections 26 to 33” substitute “sections 25A to 33”.
On Question, amendment agreed to.
Lord McKenzie of Luton moved Amendments Nos. 55 to 61:
(c) a registered pension scheme under section 153 of the Finance Act 2004—(i) which is not a scheme falling within paragraph (a) or (b), and(ii) to which the rights of a person who was at any time a member of a scheme mentioned in either of those paragraphs have been transferred.”(1) The rules of the scheme must provide that if, in the case of a member who is married or who has a civil partner, effect is to be given to the protected rights of the member by—
(3) The rules of the scheme must provide that, if effect is to be given to a member’s protected rights by the provision of a lump sum, the prescribed conditions must be satisfied.
(1) Where an occupational pension scheme is being wound up, effect may not be given to the protected rights of a member of the scheme by taking out a policy of insurance (or a number of such policies) under which the member is the beneficiary unless the policy (or each such policy) satisfies the requirement in subsection (2).
(2) The requirement is that the policy of insurance makes such provision in relation to giving effect to the protected rights of the beneficiary as a scheme to which section 25A applies is required to make under or by virtue of section 27A in relation to giving effect to the protected rights of a member of the scheme.””
“In section 2 of that Act (registration of stakeholder pension schemes) in subsection (2) (when Authority to register schemes) in paragraph (b)(i) for “to (10)” substitute “to (9)”.”
“In Schedule 5 to that Act (pension credits: mode of discharge) in paragraph 7(6) (disqualification as destination for pension credit) in the definition of “contracted-out rights”—
“In section 20 (transfer of accrued rights) in subsection (3) (regulations may provide for certain provisions to have effect subject to modifications) omit “and 43 to 45”.
On Question, amendments agreed to.
Schedule 4, as amended, agreed to.
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