Pension Schemes Bill [HL]

Baroness Altmann Excerpts

Consideration of Commons amendments & Ping Pong (Hansard) & Ping Pong (Hansard): House of Lords
Tuesday 19th January 2021 Lords Chamber

[The Deputy Speaker (Baroness Garden of Frognal) (LD)]

Noble Lords in the Chamber have indicated that they wish to speak. I call the noble Baroness, Lady Altmann.

[Baroness Altmann (Con)]

My Lords, I congratulate my noble friend the Minister on introducing this group of amendments and particularly thank her, the Bill team officials and the Pensions Regulator for engaging with us in such a collegiate manner. The co-operativeness and openness that have been shown to all noble Lords across the House have been hugely welcomed and already commented upon; I reiterate that this approach has improved the Bill and that this will continue into the future when it comes to the regulations. I congratulate the noble Baroness, Lady Bowles, the noble Lord, Lord Vaux, my noble friend Lord Young of Cookham, as well as the noble Baronesses, Lady Sherlock and Lady Drake, on the way in which we have all been able to co-operate on this important issue.

I briefly express concerns about the MaPS dashboard being sidelined and the data-security issues that may be involved in the dashboard, as well as, importantly, the fairness issues that will be dealt with in regulations of CDC schemes. Having dealt with that, I turn to Motions 4A and 4C. It is important that my noble friend can provide reassurance that scheme-specific approaches that have endured so far will be preserved. As the noble Baroness, Lady Bowles, has outlined—echoed by the noble Baroness, Lady Sherlock—there are issues on which I am confident my noble friend will be able to reassure us.

Chemicals (Health and Safety) and Genetically Modified Organisms (Contained Use) (Amendment etc.) (EU Exit) Regulations 2020

Baroness Altmann Excerpts

Wednesday 9th December 2020 Grand Committee

[Baroness Altmann (Con)]

My Lords, I thank the Minister for her excellent explanation of the statutory instrument before us. As she mentioned, there are three issues in one. They have some complexities attached, but in my view the aim of the statutory instrument is important and welcome. I hope all noble Lords will be content with it.

All three issues, although separate, are important from the point of view of public health and safety. When we are dealing with biocidal products or the classification and labelling of potentially hazardous products, as well as imports and exports of hazardous chemicals and pesticides, it is only right that the Government make sure that they address the various issues that will need to be taken care of as we leave the EU.

I welcome the Northern Ireland protocol and recognise the need to separate GB from Northern Ireland, which is entailed in these instruments. I also welcome the fact that small businesses are not exempt because, when we are dealing with products and issues of this nature, it is really important that we and the public can be confident that all kinds of hazards are being considered.

I want to ask my noble friend the Minister about a particular issue. I also, by the way, put on record my thanks to her for arranging for interested Peers a very helpful briefing, attended by her and ministerial and official colleagues; it was very much appreciated. The issue concerns the resourcing of our hugely well respected HSE. The Health and Safety Executive will need to assess these various issues. I welcome the fact that the Government are introducing time limits; Article 37(5) of the CLP regulation, for example, currently states “without undue delay”. Providing a timeframe for approval is most helpful. How confident are the Government that the HSE is equipped to do this in the timescale required and with the resourcing implications of these timescales?

I also understand that the GB MCL list must be updated. I would like some clarification on the readiness of that list and the capacity both to identify the various potential problems and to notify those who will be affected.

I do not have much else to add on this matter. I welcome the instruments and thank my noble friend for her explanation of them.

Supporting Disadvantaged Families

Baroness Altmann Excerpts

Thursday 12th November 2020 Lords Chamber

[Baroness Stedman-Scott (Con)]

I will go back and speak to my Secretary of State about the points the noble Baroness raises. I cannot make any commitment further than that. As the noble Baroness says, £16 billion is given to the devolved Administrations to allow them to plan. Last week, in the Chancellor’s Statement, there was a recognition that, through the Barnett formula, every time we do certain different policies, the devolved Administrations want to do additional things. We have a mature relationship with the devolved Administrations. They have been set a guaranteed amount of funding, and I assure the noble Baroness that there is still more room in terms of Barnett consequentials. The Chancellor was right to make the decision he did, and I am glad she welcomes it.

[Baroness Altmann (Con) [V]]

My Lords, I too welcome this Statement and this decision, and congratulate the Government. I urge my noble friend, in line with her responses, including to my noble friend Lord Forsyth, to continue urgently talking to the Treasury about the extra £20 uplift in universal credit being extended, given that the opportunity of work is much more difficult in the current environment. I also encourage the Government to look at the position of children in particular, as the noble Baronesses, Lady Lister and Lady Ritchie, have said.

Could my noble friend the Minister please join me in praising the work of others, not just Marcus Rashford—the local organisations and religious groups across the country involved in providing these activities and food for children, who have helped make the pilot scheme such a success?

Social Security (Up-rating of Benefits) Bill

Baroness Altmann Excerpts

Committee stage & Committee: 1st sitting (Hansard) & Committee: 1st sitting (Hansard): House of Lords
Tuesday 27th October 2020 Lords Chamber

[Lord Addington (LD)]

My Lords, this is nothing more than a probing amendment to clarify the Government’s thinking. There is a commitment that the Government will uprate pensions and other benefits in line with practice. However, the economic situation may not trigger that increase via the triple lock and so we do not know what will happen. Without it being stated that that will automatically be in place through the triple lock, we do not know quite what the Government’s intentions are for this year. And what happens next year? What is going on? Some information on the Government’s ongoing intentions would help here.

In the middle of the coronavirus crisis, we sometimes forget that there will probably be a world afterwards. I am not sure whether this is being glass-half-full on this occasion, but are we committed to the triple-lock or something like it? We should look at this issue, or at least pay half an eye to it, because of generational fairness, which is the idea floating at the back of this debate. This Government, and others, I hope, must ask: are we going to continue to make sure that the basic pension is enough to live on and will be a little more than it is now in the future? That might encourage people to buy in.

I look forward to the Minister’s reply and thank her for pointing out before I rose to my feet, with her devastating and scything charm, the slight change to my explanatory statement, in which I originally got the wrong year. I seek the Government’s thinking on this. It is an opportunity for the Minister to provide clarity on the process that will apply if the economic situation does not respond in line with the legislation. I beg to move.

[Baroness Altmann (Con)]

My Lords, I thank the noble Lord, Lord Addington, for his explanation of the amendment and echo his request for some clarity from my noble friend the Minister. Is she able to give us an idea of the Government’s thinking on the future uprating of pensions?

Clause 1, before proposed subsection (2A), relates to the basic pension and the standard minimum guarantee. At the moment, the triple lock does not apply to the standard minimum guarantee and pension credit. Were the amendment to be inserted, it would ensure that the poorest pensioners, who are normally those we might wish to protect the most, would get the benefit of the full triple lock. The overall issue on which I should like clarification from my noble friend is whether she can give us an idea of the Government’s thinking on the 2.5% element of the triple lock. Is that likely to continue in the light of what is happening in the rest of the economy? If so, is there any thinking within the department on ensuring that the pension credit is also uprated by the full 2.5%?

I congratulate my noble friend on pointing out what I was going to mention about the relevant 2021-22 tax year. The thrust of this probing amendment is of interest to the Committee and I look forward to her response.

[Baroness Janke (LD) [V]]

My Lords, I too welcome the amendment of my noble friend Lord Addington. We are all interested to hear the Government’s thinking, particularly on the future of the triple lock. I am sure that we all welcome their commitment to the undertakings in their manifesto and are pleased to see the Bill. However, in recent months, a lot of doubt have been shared regarding the triple lock’s future. Some people have said to me that there seems to be an almost systematic picking at the seams of the triple lock. With the Chancellor under pressure due to the economic implications of the pandemic, we would like some reassurance from the Minister that the Government are committed to ensuring that the pension keeps its value.

The state pension is particularly important to give the poorest pensioners confidence. Everyone is suffering under the pandemic but there is no doubt that the poorest are suffering worst. We would like to know the Government’s thinking for the future. Will there be a commitment in the Bill to keep the 2.5%, as well as transparency and clarity to reassure those pensioners who are particularly dependent on the state pension? I look forward to the Minister’s reply.

Pension Credit

Baroness Altmann Excerpts

Monday 26th October 2020 Lords Chamber

[Baroness Stedman-Scott (Con)]

That is a very good suggestion and, as always, I try to be responsive and helpful, so I am going to take that back to the department and I will personally come back to the noble Lord with an answer.

[Baroness Altmann (Con)]

My Lords, I congratulate my noble friend on the Government’s campaign in GP surgeries and post offices earlier this year to increase pension credit take-up. This is vital for the poorest pensioners to avoid poverty, and it makes them eligible for vital support such as housing benefits, cold-weather payments and free TV licenses. As the triple-lock does not apply to the pension credit, can the Minister say if there are further plans to improve take-up, such as using new channels, as suggested by the charity Independent Age?

[Baroness Stedman-Scott (Con)]

My Lords, as my noble friend says, the triple lock is a manifesto commitment. In February this year we launched a nationwide campaign to raise awareness of pension credit and to help dispel some of the misconceptions that people might have about their eligibility. We engage with stakeholders including Age UK, Age Scotland, Age Cymru, CAB and Independent Age, among others, to help spread the word. The point that my noble friend makes is a very good one, and we would welcome ideas from stakeholders and any noble Lords about how to best improve the understanding of what pension credit is.

Pension Protection Fund (Moratorium and Arrangements and Reconstructions for Companies in Financial Difficulty) (Amendment and Revocation) Regulations 2020

Baroness Altmann Excerpts

Wednesday 21st October 2020 Lords Chamber

[Baroness Altmann (Con)]

My Lords, I welcome the new regulations to ensure that the Pension Protection Fund can better protect its interests and those of pension scheme members whose supporting employers unfortunately need to enter a moratorium period or restructuring due to the current crisis. These cover the entities, including charitable organisations, friendly societies, credit unions and so on, which may be particularly vulnerable in the current circumstances.

The Pension Protection Fund is one of our flagship organisations, which has done marvellous work to protect the pensions of millions in this country and has compensated those who would otherwise have faced the potential of losing their pension rights if the employer failed, and possibly of losing their jobs too. It is vital that employers and corporate directors are not allowed to game the PPF or take advantage of financial turmoil to walk away from liabilities on which so many ordinary workers rely, as the noble Baroness, Lady Drake, just said. I congratulate the PPF and put on record that I believe its staff have done brilliant work. I am sure that they will continue to do so with efficient administration and careful stewardship.

These regulations result from new measures passed in the Corporate Insolvency and Governance Act, which potentially weaken the rights of DB scheme members, trustees and managers to funds and assets belonging to the sponsoring employer during a moratorium or restructuring. I thank my noble friend and congratulate her on the way in which she introduced the regulations.

To allow the Pension Protection Fund to represent the trustees and managers in negotiations is an important measure, since it has to safeguard the interests not only of each pension scheme but of all other schemes too, and a moratorium does not trigger a PPF assessment period. If pension sponsors can more easily find ways to walk away from their liabilities without putting extra funds into the schemes in the current crisis, because it ranks only as an ordinary unsecured creditor without super-priority, and financial firms have leap-frogged up the priority order, the Pension Protection Fund could be forced to take on extra liabilities, which will ultimately fall on other sponsors via higher levy payments. As I expressed during the passage of the Act, I am particularly concerned at the ability of the sponsor or its other creditors to ask the courts to release assets that were supposed to have been pledged to the pension scheme as part of previous scheme-specific funding arrangements, leaving the scheme far more underfunded than was ever intended. I understand that the legislation ensures that any restructuring plan must not put creditors in a worse position than on insolvency, but can my noble friend confirm that this also definitely applies to the Pension Protection Fund? If she would like to write to me on my point, that will be fine. In addition, which parts of the previous regulations that she mentioned in her introduction have been revoked by this instrument?

Finally, I will ask a few other questions of which I have given my noble friend prior notice. I note that the Pension Protection Fund will produce guidance for monitors and directors on what information it will need to receive and its general approach to a moratorium or restructuring. When will that happen? Can she confirm the assessment of the noble Baroness, Lady Drake, that no companies have yet gone into moratorium since this legislation was passed, and if any have, how many have done so and how many have a DB scheme attached?

[The Deputy Speaker (Baroness Garden of Frognal) (LD)]

The noble Baroness, Lady Greengross, and the noble Lord, Lord McColl, have withdrawn, so I call the noble Lord, Lord Hain.

Pension Scams

Baroness Altmann Excerpts

Wednesday 14th October 2020 Lords Chamber

[Baroness Altmann (Con)]

My Lords, I declare my interests as listed in the register. I know that my noble friend is sympathetic on this issue. Will the Government consider establishing a central intelligence database to offer providers an early warning system for scams and help potential scam victims? Can my noble friend comment on any plans to centralise the confusing array of bodies for protecting consumers, including ScamSmart, Action Fraud, the police, regulators and Project Bloom?

[Baroness Stedman-Scott (Con)]

I assure my noble friend, and indeed the whole House, that this issue is very high on the Government’s agenda. It is what we would call work in progress. We have established Project Bloom, which brings together all finance organisations, the regulator and pension providers to see what can be done and to work collaboratively. The Minister for Pensions met representatives to hear their thoughts on what the industry and Government can do. I would say, “Watch this space”.

Social Security (Up-rating of Benefits) Bill

Baroness Altmann Excerpts

2nd reading
Tuesday 13th October 2020 Grand Committee

[Baroness Altmann (Con)]

My Lords, it is an absolute pleasure to follow the noble Baroness, Lady Stuart of Edgbaston. I am sure noble Lords will join me in congratulating her on her excellent maiden speech. I know that we can look forward to many more thoughtful, powerful and productive contributions from her in the future.

The noble Baroness, Lady Stuart, will leave a footprint in this House—fear not. Her battle for the position of women in politics, business and pensions will continue. The noble Baroness has had such a distinguished career in public service: 20 years as MP for Birmingham Edgbaston, including as Health Minister and on the Joint Intelligence Committee. Now, as chair of Wilton Park, she is dealing with conflict resolution, a skill that I hope will prove particularly valuable in the context of some of the conflicts we encounter in this House—on Brexit, for example. As a non-executive director in the Cabinet Office, she is and will be a real asset to the House. I am delighted to see her here.

It is a pleasure to pay tribute to the noble Baroness, Lady Stuart, whom I met and became friends with through her dear late husband, Derek Scott, with whom I worked on pensions policy in No. 10 when he was the then Prime Minister’s chief economic adviser. Her law degree and her near-PhD on pension issues have definitely stood her in good stead. Like the noble Baroness, Lady Stuart, Derek was personable, intelligent and with a really good sense of humour. All three of us were vehemently opposed to Britain joining the euro. Indeed, his warnings about the dangers of monetary union to European financial stability and the costs of bailing out weaker members such as Greece proved prescient around the time of his tragic death aged just 65 in 2012. I have no doubt that Derek would be so proud of the noble Baroness, Lady Stuart, and all that she has achieved—as, of course, are her sons, Ben and Alastair, and her wider family. I look forward to many more contributions from the noble Baroness, as do all noble Lords, I am sure.

I also pay tribute to the noble Lord, Lord Field of Birkenhead, whose maiden speech we have also heard today. I look forward to many more contributions from the noble Lord, not only on education, apprenticeships, modern slavery and national unity but on today’s subject: pensions and social security. He is, as many others have commented, a legend in his field.

The Bill before us today is vital to protect pensioners. Clearly, using earnings growth for the period May to July 2020 would make it impossible to uprate many important benefits that pensioners rely on. It is right that the Bill gives the Secretary of State discretion to increase the state pensions by an amount considered “appropriate” in light of the economy and other matters. It would be wrong to freeze state pensions in the current environment, especially when so many older people are struggling with the effects of lockdown, restrictions on their daily lives, or having to spend more on care, for example.

The UK state pension is already the lowest in the developed world relative to average earnings. I share the views of the noble Lord, Lord Blunkett, and have called, as he has, for a double lock, increasing by the best of prices or earnings. In fact, as others have said, the triple lock is not just problematic for intergenerational fairness; there is an element of intragenerational unfairness. The triple-lock construct is not entirely suitable for the purpose of preventing poverty in later life. It is more of a political construct than a rational economic policy tool to protect later life. The 2.5% is arbitrary and, in particular, does not apply to pension credit, which has to be increased only in line in with earnings, rather than the triple lock. The triple lock protects only the full basic state pension of £134.25 a week and the full new state pension of £175.20. It does not apply to SERPS or the state second pension. So it benefits the youngest pensioners most, rather than the oldest and poorest. I urge my noble friend the Minister to reassure the Committee that the pension credit will not fall behind the new state pension in any way. I also urge the department to look again at how we protect the oldest and poorest pensioners.

The noble Baroness, Lady Meacher, mentioned the issue of frozen pensions: the 4% of UK pensioners who have no right to an increase in their state pension. I know that this is a difficult issue for the department but it might be one, in the light of the pandemic and of Brexit, that we wish to reconsider.

I also ask my noble friend to look at other benefit upratings which are particularly important. One that I have commented on before is bereavement benefits; in particular, having an allowance for children that lasts longer than 18 months and disregards their parental status.

Finally, I ask my noble friend to consider particularly the position of women, the disabled and the lowest earners; in particular, the older women trying to live on far less than the full pension, even though they are entitled to a share of their former spouse’s pension after either divorce or bereavement. Could my noble friend update the Committee on the work being carried out in the department to identify what has gone wrong with the system which is meant to ensure that women receiving below the minimum have their pensions increased when their spouse reaches his state pension age, and whether remedial measures are about to be put in place?

Covid-19: Over-60s

Baroness Altmann Excerpts

Monday 12th October 2020 Lords Chamber

[Baroness Stedman-Scott (Con)]

The answer to the noble Baroness’s question needs to come from the Department of Health and Social Care. I will talk to my colleague and ensure that a letter is written to the noble Baroness with the answers to her questions.

[Baroness Altmann (Con)]

My Lords, I am glad my noble friend agrees that people in their early or mid-60s are fit and healthy, and most are able to work. However, some are genuinely unable to do so. In light of the near 20-year differential in healthy life expectancy across the UK and looming rises in unemployment, might the Government consider a bit more flexibility in the state pension and allowing early access, perhaps on health grounds?

[Baroness Stedman-Scott (Con)]

It will come as no surprise to my noble friend that the Government at this point have no plans to review early access to state pensions, as I have already said. Where people have health conditions and are in receipt of universal credit, however, depending on the circumstances, they may be able to receive an additional amount.

Pension Protection Fund (Moratorium and Arrangements and Reconstructions for Companies in Financial Difficulty) Regulations 2020

Baroness Altmann Excerpts

Monday 14th September 2020 Grand Committee

[Baroness Altmann (Con)]

My Lords, I thank my noble friend the Minister for laying these amendments and for the excellent way in which she introduced them. I also support the amendments and believe that many of the points made by the noble Baroness, Lady Drake, are particularly relevant. It is clearly important that the Pension Protection Fund has some recognition—or as much as possible, if you like—in the new environment that has created the moratorium and various super-priorities. It is important that the Pension Protection Fund retains creditor rights where it can to avoid gaming of the fund, which otherwise could be overwhelmed with extra liabilities that are picked up by other pension schemes.

I agree with my noble friend that it is important to ensure that these regulations are able to act in the interests of the Pension Protection Fund and to balance that against the need to preserve functioning and ongoing sponsors during the current emergency. Can my noble friend help the Committee understand what powers this grants to the Pension Protection Fund? I recognise, and we discussed through the passage of the Corporate Insolvency and Governance Act, that there is a limit on the power of the Pension Protection Fund. I appreciate the Government’s amendments, which have introduced some representation, but, for example, if trustees, as was suggested by the noble Baroness, Lady Drake, prefer to approve a high-risk restructuring strategy but the board of the Pension Protection Fund believes the risk is too high and would result in higher costs to it when the company fails—as the board believes would be most likely given the balance of risks that that restructuring would entail—would it have the power to override the trustees and to refuse to agree the proposed course of action and, ultimately, ensure that the company fails sooner rather than later, or would that not be within its powers under the new system?

Equally, if the management of the company wishes to try to sell assets that have already been pledged to the pension scheme and apply to a court to permit this—I understand the corporate insolvency Act permits the authorisation of the sale of such assets and the PPF must be informed or consulted—does the PPF have powers to protect itself against such a transaction on which the funding of that defined benefit scheme had previously been based? What representations might it be able to make in the court environment? Does it have the power to demand detailed information or to conduct its own investigations into the financial position of the company when it is aiming to restructure or undertake some asset sales? Does the Pension Protection Fund have the power to investigate the impact of any loans or other restructuring agreed in a moratorium that might be beneficial to favoured lenders or, ultimately, to the owners of the company, who might end up taking over a restructured operation, having jettisoned the pension fund to the detriment of the funding of the pension scheme when it goes into the PPF?

How do the Government plan to deal with schemes when banks or other lenders to a company during a moratorium attempt to leapfrog ahead of the pension scheme on insolvency, should that occur. At what stage does the Pension Protection Fund have any power to prevent this happening or to be able to intervene to represent its interests if it believes such loans are suspect or may be intended to game the PPF? I have given prior notice of these questions to my noble friend and was grateful to hear that Ministers have some ability to override some of the potential risks to pension scheme members and to other pension scheme members.

I know that it is important to make sure that the Pension Protection Fund—

[Baroness Scott of Bybrook (Con)]

My Lords, there is a five-minute limit.

[Baroness Altmann (Con)]

I apologise.