National Insurance Contributions (Employer Pensions Contributions) Bill

Caroline Nokes Excerpts

2nd reading
Wednesday 17th December 2025 Commons Chamber

[Mark Garnier]

Indeed—our report, though it was published in May this year. It is a weighty tome. Even its title is pretty dry: “Understanding the attitudes and behaviours of employers towards salary sacrifice for pensions”. The Minister proudly told us that this document underscored the rationale for—[Interruption.] Oh—because it is important stuff. He told us that it underscored the rationale for capping salary sacrifice. However, having read the report, I can tell the House that it actually concludes that:

“All the hypothetical scenarios explored in this research”,

including the £2,000 cap, “were viewed negatively” by those interviewed. The changes would cause confusion, reduce benefits to employees and disincentivise pension savings. The report the Minister is using tells him not to do this.

The report also goes into why salary sacrifice for pensions is used by employers in addition to the incentive of paying into a pension, stating that extra benefits include: savings for employees, so that they have more to spend on essentials, tackling the cost of living crisis; savings for employers, which they can then invest back into their business and staff; and incentives for recruitment and retention. These are all good things—this is the stuff of delivering growth and the basis of creating a savings and investment culture. Why would this Government want to take it away?

The report came to the conclusion that of the three proposed options for change, the £2,000 cap is no more than the least terrible option. [Interruption.] The Minister talks about it being a secret plan—it is a published document. What is he talking about? It is the most extraordinary thing. He refers to it in terms that none of us recognises. But he has brought this in—this is the point. Is the Minister chuffed that his choice comes down to the least worst option for everyone? Here is the truth: it was the Chancellor’s choice to introduce this policy, and this Government are the ones implementing it—they are the ones who are in government.

Let us get to the measures and the impact of the Bill. To be fair, it is a very even Bill; there is something in it for everybody to hate. Take middle-income earners, who are typically in their 30s, and who earn on average a touch under £42,000 a year. This is the target area where the attack on savings starts. This is right at the point in life where people should be doing their very best for their future retirement. It is a perfect target market for the Government’s savings ambitions. However, it does not stop there. In total, at least 3.3 million savers will be affected, which is 44% of all people who use salary sacrifice for their pension. These are all people who work hard—people on whom the Chancellor promised not to raise taxes.

In fact, middle-income employees will be affected more than higher earners. According to the Financial Times, under the Bill, an employee who earns £50,000 and sacrifices 5% of that will pay the same amount in national insurance contributions as an employee on £80,000. If the contribution rate is doubled to 10% of their salary, the disparity grows even further, meaning that an employee earning £50,000 will pay the same amount in national insurance contributions as an employee on £140,000. How is that fair? The Government keep telling us that this policy will affect top earners, but the reality is that those on middle incomes will be disproportionately hit—the very people we should be encouraging to save more.

The Bill will also potentially hit low earners. Somebody who is lucky enough to get a Christmas bonus will not be able to add it to their salary sacrifice, taking advantage of any headroom, because the accounting looks at regular payments, not one-offs. [Interruption.] I am slightly worried, Madam Deputy Speaker, that the pairing Whip has a rather bad cough; I hope he gets better. This will potentially hit the 75% of basic rate taxpayers the cap supposedly protects.

Finally, the Bill hits employers. In the previous Budget, the Government absolutely hammered business. They increased employer national insurance contributions to 15% and, at the same time, reduced the starting threshold to £5,000. Businesses reacted and adapted. They were reassured by the Chancellor’s promise that she would not come back for more, yet here we are discussing further tax rises on businesses.

Let us look at the actual impact this raid on pensions will have on employers. According to the Government’s own impact assessment, it will hit 290,000 employers. A business highlighted in the 2025 report that

“If salary sacrifice were to go away, it would be additional cost of £600,000 to £700,000 per annum to the company in national insurance”.

While the Government are not abolishing it altogether, 44% of people currently using salary sacrifice—[Interruption.] I am worried; the pairing Whip is coughing. Anyway, there is going to be a cost, and that money will be taken away from businesses. This is going to be—[Interruption.] The Minister is chuntering from a sedentary position; he is obviously proud of what he is doing to the pensions industry.

Furthermore, the change will create administrative burdens for employers. With the current system, there are few administrative issues; the only thing that businesses have to bear in mind is ensuring that their employees’ pay does not fall below the national living wage—that is it. So what do the Government do? They go for the most complicated option that the report considered. That was explicitly stated by those involved in the research. As a pensions administration manager for a large manufacturing employer said,

“We’d have to reconfigure all our payroll systems and all our documentation. It would be a big job.”

The National Audit Office estimates that the annual cost on business just to comply with this Government’s tax system is £15.4 billion, yet the Government feel that the time is right to put more costs on businesses. I have to ask, what happened to the Chancellor’s pledge to cut red tape by a quarter?

I think I will move on to my conclusion in order to save people. [Laughter.] There was some great stuff in this speech, but I understand that people want to get away and wrap their Christmas stockings—particularly the Pensions Minister who, like the Grinch, is taking a lot of money away. To conclude, the Government should think again on this policy. People are simply not saving enough for their retirement. We need to do more to encourage them to save for their retirement. I know that the Minister would agree with that, so I hope that he hears the genuine concerns I have raised on behalf of a lot of people. Many people and businesses and are very worried about this policy, and he needs to take it away and think carefully about it.

Fundamentally, we are taking away something that is beneficial to the individual while also being tax efficient for business. Instead of encouraging the creation of incentives such as salary sacrifice or pensions, we are reducing the number. It is the wrong policy, and it sends the wrong message at the wrong time. All it does is add to the ongoing narrative that, “If you work hard to make a decent income, you will lose out. If you work hard as an employer to grow your business, you will lose out. If you try to save towards dignity and retirement, you will lose out.” It is the wrong policy to pursue and we will definitely vote against it tonight.

[Madam Deputy Speaker (Caroline Nokes)]

I remind Members that the knife will fall at 7 o’clock.

[Jim Dickson (Dartford) (Lab)]

The Chancellor’s Budget, delivered at the end of November, enables the Government to deliver on the priorities that we set out clearly in our manifesto last year. I pay tribute to the work that the Chancellor and the Ministers on the Front Bench tonight and across the Treasury team have done on that.

As the Minister said, this is a very straightforward Bill. It means that from April 2029, there will be limits to NICs relief that higher earners can take advantage of through salary sacrifice. Importantly, it protects lower earners with a £2,000 threshold. It is always a challenge for any Government to find the right balance in their policies. This change ensures fairness in a system where we could otherwise have seen the costs of salary sacrifice schemes triple between 2017 and the end of the decade. That would undermine vital public service and investment priorities, such as the armed services, the NHS, SEND, our prison system and a vast number of other public services that everyone in this House would want to see properly funded.

The greatest burden in this change is therefore being borne by those with the broadest shoulders. It is right that we have kept our manifesto pledges on tax, and it should only be in the most challenging of circumstances that we step back from those commitments. This change has enabled us to keep those pledges. It is good to see the Government getting on with delivering the change we promised, with inflation coming down; a sixth cut in interest rates coming soon, we hope; gilt prices moving in the right direction; and growth forecast to rise next year.

As a Member of the Treasury Committee, I have not had a chance to speak in the Chamber since the Budget. With your indulgence, Madam Deputy Speaker, I would like to welcome the lifting of the two-child benefit cap. It was clear from the evidence we heard on the Committee that this change will transform thousands of young lives—

[Madam Deputy Speaker]

Order. I will make exactly the same point I made yesterday. Yesterday’s debate was about the Finance Bill, and this debate is on the National Insurance Contributions (Employer Pensions Contributions) Bill. It is not on the two-child cap or on spending commitments.

[Jim Dickson]

Thank you for your guidance, Madam Deputy Speaker.

I will conclude simply by saying that when the Chancellor appeared before our Committee last week, she was clear that this was a Budget of necessary and fair choices on tax—of which the Bill is one—so that we can deliver on the public’s priorities of rebuilt public services and fair growth. This change enables us to do that.

[Madam Deputy Speaker]

I call the Liberal Democrat spokesperson.

--- Later in debate ---

[Graham Leadbitter (Moray West, Nairn and Strathspey) (SNP)]

While businesses are still reeling from last year’s national insurance increase, with this Bill the Labour Government are set to increase tax again by making salary sacrifice pension contribution schemes worse for workers.

What has the Labour party said previously? In its 2024 manifesto, on page 79, it stated:

“Our system of state, private, and workplace pensions provide the basis for security in retirement…We will also adopt reforms to workplace pensions to deliver better outcomes for UK savers and pensioners.”

It gets even more ridiculous when we see that the same manifesto also stated on page 21:

“Labour will not increase taxes on working people, which is why we will not increase National Insurance”.

That is exactly what the Bill does.

Recent survey data from the Confederation of British Industry showed that three in four employers will have to decrease pension contributions as a result of the measures in the Bill. As the CBI has said, it is

“‘a tax on doing the right thing’”.

It goes on to state:

“Ultimately, this unwise move will only damage growth, investment and pension saving rates.”

It is not just the CBI that has voiced alarm at the Bill. The Association of British Insurers stated:

“Capping salary sacrifice for pension saving is a short-sighted tax grab which will lower pension saving and undermine people’s retirement security.”

The Minister said in his introduction that

“everyone who has thought about this”

will come to the same conclusion. He might not wish to refer to the CBI and ABI coming to different conclusions, but they have clearly thought about it.

It is not even clear that the measure will raise the money that the Chancellor expects. A former pensions Minister from the coalition era has said that he expects it to raise “a fraction” of the intended amount, as firms will restructure payments to evade it. In addition to the likelihood of payments being restructured, even the OBR has made it clear to the Chancellor that it expects employers simply to pass the cost on to employees through lower wages and less generous schemes. It will be working people who ultimately pay for this short-term thinking, with a lower standard of living and less spending power in their retirement.

As we have seen with the maladministration of pension changes for 1950s-born women, politicians cannot and must not change the goalposts on retirement planning without giving significant advance notice. Any approach otherwise, such as in the Bill, is deeply unfair to savers. This move will land businesses with yet more administrative costs, disproportionately hitting small to medium-sized employers who are still absorbing the increased NIC costs from last year’s Budget. Is this muddled policy really from a Government who stood on a pledge of growing the economy? This is yet again another Budget with another rise in national insurance by Labour.

There are numerous unanswered questions, but the following are top of the list. What assessment has the Minister made of likely behavioural changes to pension savings as a result of this policy? What is the estimated increased cost to businesses as a result of this policy? Does the Minister anticipate lower pensions for workers as a result of this policy, and if so, how much would the decrease be? Can the Labour Government seriously make a commitment in this Chamber not to increase national insurance in next year’s Budget, given the rises in both their Budgets since coming into power? This Bill is deeply flawed and the SNP will not support it today.

[Madam Deputy Speaker (Caroline Nokes)]

As there are no further Back-Bench contributions, I call the shadow Minister.

[Richard Fuller (North Bedfordshire) (Con)]

For a Bill that proposes to raise taxation on working people by such a large amount, this has been a remarkably brief debate. But I commend my hon. Friend the Member for Solihull West and Shirley (Dr Shastri-Hurst), who correctly said that this was yet another anti-aspiration measure from this Government, and the hon. Member for Moray West, Nairn and Strathspey (Graham Leadbitter), who made it clear that this was yet another example of Labour breaking its manifesto pledge not to raise taxes on working people. He also asked one of the key questions, which I hope the Minister will address in his reply: as this measure is due to come into force in three years’ time, what assessment have the Government made of behavioural changes, and can the Minister be assured that the amount in the OBR forecast is robust on a dynamic accounting basis?

This is the final economic Bill of the year to be voted on in the House of Commons, and it is another Bill that targets people who are trying to do the right thing. The Bill is a bad measure. It is an anti-savings measure and it is an attack on prudence, so of course the Conservative party will oppose it. This final Bill, at the end of this full-on year of Labour government, leaves me with one fundamental question: why do the Labour Government hate the private sector so much? If you are a family farmer, the Labour Government will snatch your farm away from your children when you die. If you believe in private education, the Labour Government will put up a barrier at the school gate. If you save for your retirement, Labour will tax your every effort to achieve security in retirement. Why do the Labour Government take every opportunity to punish people who are trying to do the right thing?

The Bill makes a mockery of the Government’s own Pensions Commission, set up in July this year, when it wrote:

“Put bluntly, private pension income for individuals retiring in 2050 could be 8% lower than those retiring in 2025—undermining a central measure of societal progress.”

Back in June, the Government recognised the problem of a secure retirement. Now, they are adding to the problem.

I have a question about the numbers. It is interesting that this measure is scored by the OBR in that crucial year of 2029-30 at £4.845 billion, falling the following year to £2.585 billion. That is an important year, because that is when the Chancellor says she has put in all this headroom—how interesting. Does the Minister agree with the director of Willis Towers Watson, one of the world’s biggest advisers on pensions, when he said:

“While earlier introduction would be unwelcome, the change appears to have been timed to maximise revenue in 2029/30—the year that counts for the Chancellor’s fiscal rule. £1.6 billion of revenue in that year is a temporary gain which will be returned to taxpayers who pay employee contributions instead and claim back part of their tax relief”?

On the £4.845 billion—the full amount—is any of that actually a fiction that will be returned the following year, as experts suggest it will be?

The Bill makes it less attractive for employers to contribute to private sector pensions. We all know that there is less certainty in the private sector, because that is where defined contribution schemes predominate, whereas in the public sector, greater certainty is given by a defined benefit scheme. In the public sector, there is also benefit because the contribution from the employer to employee pensions is much higher than in the private sector. In the public sector, employer contributions are equivalent to 27% of earnings, on average, according to research by the Taxpayers’ Alliance, but in the private sector the average contribution is only 8%. Why are the Government proposing to make it harder for private sector employers to contribute to the pensions of their employees? The Bill actively exacerbates the differences. By the way, it does nothing to tackle the unfunded £1.5 trillion liability of unfunded public sector pensions, which will fall on taxpayers.

The Bill is yet another example of the lack of private sector experience on the Government Front Bench. This Government are the least business aware Government in our country’s history. They are taxing and regulating growth out of our economy. Labour Ministers are punishing workers who want to save more for their retirement, and making it harder for their employers to help them to do so. While they can rely on their cushy, gold-plated public sector pensions, private sector workers are worse off.

[Madam Deputy Speaker (Caroline Nokes)]

Order. Before I call the Minister, I want to put on the record that the behaviour I have seen on both Front Benches this evening has been about the worst I have ever witnessed. The debate should take place across the Dispatch Box, not from a sedentary position. [Interruption.] No—not “He started it!” This is not a classroom.

Pension Schemes Bill

Caroline Nokes Excerpts

Report stage
Wednesday 3rd December 2025 Commons Chamber

[The Parliamentary Under-Secretary of State for Work and Pensions (Torsten Bell)]

I beg to move, That the clause be read a Second time.

[Madam Deputy Speaker (Caroline Nokes)]

With this it will be convenient to discuss the following:

Government new clause 31—Indexation of periodic compensation for pre-1997 service: Great Britain.

Government new clause 32—Indexation of periodic compensation for pre-1997 service: Northern Ireland.

Government new clause 33—Financial Assistance Scheme: indexation of payments for pre-1997 service.

Government new clause 34—Exemption from public procurement rules.

Government new clause 35—Funding of the Board of the Pension Protection Fund.

New clause 1—Independent review into pension losses incurred by former employees of AEA Technology—

“(1) The Secretary of State must, within three months of the passing of this Act, commission an independent review into the pension losses incurred by former employees of AEA Technology who—

(a) transferred their accrued pension benefits out of the UK Atomic Energy Authority (UKAEA) public service scheme to AEA Technology (AEAT) on privatisation in 1996, and

(b) suffered financial losses when AEA Technology went into administration in 2012 and the pension scheme entered the Pension Protection Fund (PPF).

(2) The review must examine—

(a) the extent and causes of pension losses incurred by affected individuals,

(b) the role of Government policy and representations in the transfer of pensions during the privatisation of AEA Technology,

(c) the findings of the Public Accounts Committee and the Work and Pensions Select Committee,

(d) the adequacy of safeguards provided at the time of privatisation,

(e) potential mechanisms for redress or compensation, and

(f) the estimated financial cost of any such mechanisms.

(3) The review must be—

(a) conducted by an independent panel appointed by the Secretary of State, with relevant expertise in pensions, public policy, and administrative justice, and

(b) transparent and consultative, including engagement with affected pensioners and their representatives.

(4) The panel must report its findings and recommendations to the Secretary of State and lay a copy of its final report before Parliament within 12 months of its establishment.

(5) The Secretary of State must, within 6 months of the publication of the report under subsection (4), lay before both Houses of Parliament a statement setting out the Secretary of State’s response to that outcome.”

This new clause would require the Secretary of State to commission an independent review into the pension losses incurred by former employees of AEA Technology.

New clause 2—Transfer of British Coal Staff Superannuation Scheme investment reserve to members—

“(1) Within 3 months of the passing of this Act, the Secretary of State must by regulations make provision for the transfer of the British Coal Staff Superannuation Scheme investment reserve to members of the scheme.

(2) Those regulations must include—

(a) a timetable for transferring the total of the investment reserve to members of the scheme, and

(b) plans for commissioning an independent review into how future surplus will be shared.

(3) A statutory instrument containing regulations under this section may not be made unless a draft of the instrument has been laid before and approved by a resolution of each House of Parliament.”

This new clause would require the Secretary of State to set out in regulations a timetable for transferring the whole of the BCSSS investment reserve to members and committing to review how future surplus will be shared.

New clause 3—Terminal illness: means of demonstrating eligibility—

“(1) The Secretary of State must by regulations make provision about how a person may demonstrate that they are terminally ill for purposes relating to compensation or assistance from the Pension Protection Fund or Financial Assistance Scheme.

(2) In making regulations under this section, the Secretary of State must seek to minimise the administrative burden placed upon the person with a terminal illness.

(3) Regulations under this section must provide that, where the Department of Work and Pensions (“the Department”) holds a valid SR1 form in respect of a person seeking to demonstrate that they are terminally ill for purposes relating to compensation or assistance from the Pension Protection Fund or Financial Assistance Scheme, the Department must share that form with the Pension Protection Fund or the Financial Assistance Scheme.

(4) Regulations under this section must require the Pension Protection Fund and the Financial Assistance Scheme to make the appropriate payment or payments within a specified time of receipt of a valid application.”

This new clause would require the Secretary of State to provide, by regulations, for the use of a valid SR1 form to make it easier for a person to demonstrate that they are terminally ill for purposes related to compensation from the PPF or FAS.

New clause 4—Review into investment in defence companies—

“(1) The Secretary of State must, within six months of the passing of this Act, carry out a review into investment in defence companies within Local Government Pension Schemes.

(2) The review must consider how the investment in defence companies—

(a) impacts on, and

(b) aligns with,

the UK Government’s international obligations.

(3) The Secretary of State must prepare a report of the review and lay a copy of that report before Parliament.”

This new clause would require the Secretary of State to conduct a review into investment in defence companies within Local Government Pension Schemes and how that impacts and aligns with Government international obligations.

New clause 5—Review into defined benefit schemes’ social impact—

“(1) The Secretary of State must, within 12 months of the passing of this Act, carry out a review into the social impact of defined benefit schemes.

(2) The review must include an assessment of—

(a) the efficacy of investment strategies in delivering social good, and

(b) the potential impact of increasing investment in—

(i) social housing, and

(ii) green technology.

(3) For the purposes of this section—

“social good” means something which benefits society as a whole, and

“green technology” means the use of technology and science to create environmentally-friendly products and services.

(4) The Secretary of State must prepare a report of the review and lay a copy of that report before Parliament.”

This new clause would require the Secretary of State to review the efficacy of investment in terms of delivering social good and the benefits of directing more investment towards social housing and green technology.

New clause 6—Indexation of pre-1997 service—

“(1) The Secretary of State must by regulations make provision for indexation on compensation in respect of pre-1997 rights for members of the Pension Protection Fund and the Financial Assistance Scheme.

(2) Those regulations must specify that—

(a) pension payments from the PPF and FAS are increased each year in line with Consumer Prices Index (CPI) inflation for pensionable service before and after 6 April 1997,

(b) where a PPF or FAS member has pensionable service prior to 6 April 1997 which has not increased each year in line with CPI inflation, but which their scheme provided for, the scheme manager must—

(i) determine the annual increase attributable to that service for each year since the date on which the annual payment was first payable, and

(ii) reimburse the member for the amount determined under paragraph (b)(i), and

(c) increased payments must also apply to transferee members, to ill health payments and to payments to surviving dependants.

(3) Regulations under this section—

(a) shall be made by statutory instrument, and

(b) may not be made unless a draft has been laid before and approved by resolution of each House of Parliament.”

This new clause would require the Secretary of State to provide, through regulations, for indexation on PPF and FAS compensation in respect of pre-1997 rights.

New clause 7—Report on indexation of pre-1997 Pension Protection Fund and Financial Assistance Scheme benefits—

“(1) The Secretary of State must, within 12 months of the passing of this Act, publish a report on options for providing indexation to pension rights relating to pre-1997 service in the Pension Protection Fund (PPF) and the Financial Assistance Scheme (FAS).

(2) The report must consider—

(a) the current absence of indexation on pre-1997 accrued rights and the financial impact on affected pensioners;

(b) the number of pensioners affected and the mortality rates since the establishment of FAS and PPF, including evidence from the Pensions Action Group;

(c) the feasibility of introducing indexation, in full or in part, for pre-1997 rights;

(d) the potential use of scheme reserves, including residual funds from failed schemes transferred into the FAS, and the implications for taxpayers;

(e) the urgency of reform given the age profile of affected members and the social impact of frozen incomes;

(f) alternative funding mechanisms that could deliver indexation without undermining the sustainability of the PPF; and

(g) comparative approaches to legacy benefit indexation in other jurisdictions.

(3) In preparing the report, the Secretary of State must consult—

(a) the Pensions Regulator,

(b) the Pension Protection Fund,

(c) representatives of Financial Assistance Scheme members,

(d) the Pensions Action Group, and

(e) such other stakeholders as the Secretary of State considers appropriate.

(4) The Secretary of State must lay a copy of the report before both Houses of Parliament.”

This new clause would require the Secretary of State to publish a report examining options for addressing the lack of indexation on pre-1997 pensionable service in the PPF and FAS, with particular regard to evidence provided by the Pensions Action Group, mortality data, scheme reserves, and the urgency of the issue.

New clause 8—Universal Pension Advice Entitlement—

“(1) The Secretary of State must by regulations establish a system to ensure that every individual has a right to receive free, impartial pension advice at prescribed times.

(2) Regulations under subsection (1) must provide for individuals to be offered advice—

(a) at or around the age of 40; and

(b) at a prescribed age, not more than six years before the individual's expected retirement age.

(3) The regulations must make provision about—

(a) the content and scope of the free, impartial pension advice, which may include, but is not limited to, guidance on—

(i) pension types (including both defined contribution and defined benefit schemes),

(ii) investment strategies,

(iii) charges,

(iv) consolidation of pension pots, and

(v) retirement income options;

(b) the qualifications, independence, and impartiality requirements for any person or body providing advice;

(c) the means by which individuals are notified of their entitlement to receive the advice and how they may access it;

(d) the roles and responsibilities of pension scheme trustees, managers, and providers in facilitating access to advice;

(e) the sharing member information with prescribed persons or bodies subject to appropriate data protection safeguards.

(4) Regulations under this section may—

(a) make different provision for different descriptions of pension schemes or different descriptions of individuals;

(b) confer functions in connection with the provision or oversight of the advice on—

(i) the Pensions Regulator,

(ii) the Financial Conduct Authority,

(iii) the Money and Pensions Service, or

(iv) other prescribed bodies;

(c) require the provision of funding for the advice service from prescribed sources.

(5) A statutory instrument containing regulations under this section may not be made unless a draft of the instrument has been laid before and approved by a resolution of each House of Parliament.”

This new clause makes provision by regulations for everyone to receive free, impartial pension advice at age 40 and again around five years before their expected retirement.

New clause 10—Independent review of forfeiture of survivor pensions in police pension schemes—

“(1) The Secretary of State must commission an independent review into the impact and fairness of provisions within police pension schemes that result in the forfeiture, reduction, or suspension of survivor pensions on the grounds of—

(a) remarriage or entry into a civil partnership by the surviving partner of a deceased scheme member; or

(b) cohabitation with another person as if married or in a civil partnership.

(2) The review must examine—

(a) the legal and policy basis for such provisions;

(b) the financial, social, and emotional impact on affected individuals and families;

(c) consistency with other public sector pension schemes, including schemes for—

(i) the Armed Forces,

(ii) the NHS, and

(iii) the civil service;

(d) potential options for reform, including retrospective reinstatement of pensions;

(e) any other matters the Secretary of State considers relevant.

(3) The Secretary of State must—

(a) appoint an independent person or panel with relevant legal, pensions, and public policy expertise to conduct the review; and

(b) publish the terms of reference no later than three months after this Act is passed.

(4) The person or panel appointed under subsection (3) must—

(a) consult with relevant stakeholders, including—

(i) the National Association of Retired Police Officers (NARPO),

(ii) survivor pension recipients,

(iii) police staff associations, and

(iv) pensions experts;

(b) consider written and oral evidence submitted by affected individuals; and

(c) publish a report of its findings and recommendations within 12 months of appointment.”

This new clause would require the Secretary of State to commission an independent review into the impact and fairness of provisions within police pension schemes that result in the forfeiture, reduction, or suspension of survivor pensions.

New clause 11—Independent review into state deduction in defined benefit pension schemes—

“(1) The Secretary of State must, within three months of the passing of this Act, commission an independent review into the application and impact of state deduction mechanisms in occupational defined benefit pension schemes.

(2) The review must consider—

(a) the origin, rationale and implementation of state deduction in the Midland Bank Staff Pension Scheme,

(b) the clarity and adequacy of member communications regarding state deduction from inception to present,

(c) the differential impact of state deduction on pensioners with varying salary histories, including an assessment of any disproportionate effects on—

(i) lower-paid staff, and

(ii) women,

(d) comparisons with other occupational pension schemes in the banking and public sectors, and

(e) the legal, administrative, and financial feasibility of modifying or removing state deduction provisions, including potential mechanisms for redress.

(3) The Secretary of State must ensure that the person or body appointed to conduct the review—

(a) is independent of HSBC Bank plc and its associated pension schemes;

(b) possesses relevant expertise in pensions law, occupational pension scheme administration, and equality and fairness in retirement income; and

(c) undertakes appropriate consultation with—

(i) affected scheme members,

(ii) employee representatives,

(iii) pension experts, and

(iv) stakeholder organisations.

(4) The person or body conducting the review must—

(a) submit a report on its findings to the Secretary of State within 12 months of the date the review is commissioned; and

(b) the Secretary of State must lay a copy of the report before Parliament and publish the report in full.

(5) Within three months of laying the report before Parliament, the Secretary of State must publish a written response setting out the Government’s proposed actions, if any, in response to the report’s findings and recommendations.

(6) For the purposes of this section—

“state deduction” means any provision within a defined benefit occupational pension scheme that reduces pension entitlements by reference to the member reaching state pension age or by reference to any state pension entitlement;

“defined benefit pension scheme” has the meaning given in section 181 of the Pension Schemes Act 1993;

“Midland Bank Staff Pension Scheme” includes all associated legacy arrangements and any successor schemes administered by HSBC Bank Pension Trust (UK) Ltd.”

This new clause would require the Secretary of State to commission an independent review into clawback provisions in occupational defined benefit pension schemes, in particular, the Midland Bank staff pension scheme.

New clause 12—Section 40 commencement—

“(1) The provisions in section 40 shall not come into force except in accordance with regulations made by the Secretary of State.

(2) A statutory instrument containing regulations under subsection (1) may not be made unless a draft of the instrument has been laid before and approved by a resolution of each House of Parliament.”

This new clause would require that the provisions in clause 40 could only be enacted once agreed through secondary legislation.

New clause 13—Targeted Advice Access for Under-Saving Cohorts—

“(1) The Secretary of State must make regulations to provide enhanced access to pension advice or guidance for cohorts identified as under-saving for retirement.

(2) Regulations may make provision for—

(a) identifying under-saving groups, including but not limited to—

(i) women,

(ii) ethnic minority groups, and

(iii) others affected by long-term pay or pension gaps;

(b) mechanisms to fund and deliver targeted support;

(c) reporting and evaluation requirements to assess take-up and effectiveness.

(3) A statutory instrument containing regulations under this section may not be made unless a draft of the instrument has been laid before and approved by a resolution of each House of Parliament.”

This new clause allows for the creation of targeted pension advice or guidance interventions for groups at risk of under-saving for retirement.

New clause 14—Cap on cost of advice for pension holders—

“(1) The Secretary of State may by regulations introduce a cap on the cost recoverable for providing pension advice per pension holder under any scheme operating free or subsidised advice.

(2) The cap may vary depending on—

(a) the value of the pension pot;

(b) the type of pension scheme;

(c) the complexity of advice required.

(3) A statutory instrument containing regulations under this section may not be made unless a draft of the instrument has been laid before and approved by a resolution of each House of Parliament.”

This new clause enables the introduction of a cost ceiling for advice provision to members of pension schemes.

New clause 15—Independent review into the British Coal Staff Superannuation Scheme—

“(1) The Secretary of State must, within three months of the passing of this Act, commission an independent review into the treatment of members of the British Coal Staff Superannuation Scheme (BCSSS).

(2) The review must consider—

(a) the origin and operation of the Government’s surplus-sharing arrangements with the BCSSS since 1994,

(b) the adequacy of communication to scheme members regarding the use of surpluses,

(c) the impact of the Government’s retention of scheme reserves on members’ retirement income,

(d) representations made by the Trustees of the BCSSS calling for reserves to be released to members, and

(e) options for reforming how any future surpluses in the BCSSS are shared between the Government and scheme members.

(3) The person or body appointed to conduct the review must—

(a) be independent of the Government and the BCSSS Trustees,

(b) possess relevant expertise in pensions law and scheme administration, and

(c) consult with affected members, Trustees, pension experts, and stakeholder organisations.

(4) The review must report to the Secretary of State within 12 months of being commissioned, and the Secretary of State must lay the report before Parliament and publish it in full.

(5) Within three months of publication, the Secretary of State must publish the Government’s response to the review’s findings.”

This new clause would require the Secretary of State to commission an independent review into the treatment of members of the British Coal Staff Superannuation Scheme, including the handling of scheme reserves and future surplus-sharing arrangements.

New clause 16—Report on Pension Scheme Eligibility and Access—

“(1) The Secretary of State shall, within 12 months of the passing of this Act, lay before Parliament a report into the operation of occupational pension schemes where certain categories of employees have been excluded on the basis of job classification or employment start date.

(2) The report must examine the case of employees and former employees of Fife Joinery Manufacturing (a subsidiary of Velux), including—

(a) whether affected workers were provided with opportunity to join existing pension schemes,

(b) the adequacy of record-keeping and employer accountability, and

(c) potential remedies to ensure equal access to workplace pensions.”

This new clause would require the Secretary of State to report on the Velux Pensions case.

New clause 17—Clarification of pension scheme investment duties—

“(1) The Pensions Act 1995 is amended as follows.

(2) In section 36 (Choosing investments), after subsection (9), insert—

“(10) Regulations under subsection (1) must provide—

(a) that when interpreting the best interest or sole interests of members and beneficiaries for the purposes of this section and the regulations, the trustees of a trust scheme may (amongst other matters) take the following into account—

(i) system-level considerations,

(ii) the reasonably foreseeable impacts over the appropriate time horizon of the assets or organisations in which the trust scheme invests upon prescribed matters, including upon members’ and beneficiaries’ standards of living, and

(iii) the views of members and beneficiaries;

(b) that investment powers or discretions must be exercised in a manner that considers and manages the matters specified in subsection (10)(a)(i) and (ii) where they are financially material; and

(c) a prescribed definition of the term “appropriate time horizon” for these purposes.

(11) For the purposes of this section, “system-level considerations” means, over the appropriate time horizon, risks and opportunities relevant to the scheme that—

(a) cannot be fully managed through diversification alone, and

(b) arise from circumstances at the level of one or more economic sectors, financial markets or economies, including but not limited to those relating to environmental or social matters.

(12) Regulations under subsection (1) must come into force no more than one year after the passing of the Pension Schemes Act 2025.

(13) In complying with requirements imposed by this section and regulations, a trustee or manager must have regard to guidance prepared from time to time by the Secretary of State.”

(3) The Financial Conduct Authority must make general rules with effects corresponding to the provisions of subsection (1) for providers of pension schemes to which Part 7A of the Financial Services and Markets Act 2000 (inserted by section 48 of this Act) applies.

(4) The Secretary of State must make regulations with effects corresponding to the provisions of subsection (1) for scheme managers of the Local Government Pension Scheme.

(5) The rules and regulations under subsections (3) and (4) must come into force no later than the date on which regulations pursuant to section 36(10) of the Pensions Act 1995 (as amended by this Act) come into force.”

This new clause gives the Secretary of State a duty to make regulations clarifying investment duties of occupational pension schemes, including system-level considerations and other matters including impacts of investee firms, beneficiaries’ standards of living and views. It also imposes duties on the FCA and the Secretary of State to make corresponding rules and regulations for workplace personal pension schemes and the Local Government Pension Scheme respectively.

New clause 18—Report on indexation of pre-1997 benefits—

“(1) The Secretary of State must, within 6 months of the passing of this Act, publish a report on whether the Pension Protection Fund and the Financial Assistance Scheme should provide indexation on compensation in respect of pre-1997 rights, where pension schemes provided for that.

(2) The report must consider—

(a) the potential benefits for affected pensioners;

(b) approaches of occupational pension schemes to indexation of pre-1997 benefits;

(c) the impact on compensation schemes’ surpluses and on public finances;

(d) international approaches to indexation of legacy pension benefits.

(3) The Secretary of State must lay a copy of the report before both Houses of Parliament.”

This new clause requires the Secretary of State to report on whether the PPF and FAS should provide indexation on compensation in respect of pre-1997 rights, where scheme rules provided for that.

New clause 19—Fossil fuels and climate change risk—

“(1) The Pensions Act 1995 is amended as follows.

(2) In section 41A (Climate change risk), after subsection (6) insert—

“(6A) Regulations under subsection (1) must, within 1 year of the Pension Schemes Act 2025 receiving Royal Assent, prohibit the trustees or managers of schemes of a prescribed description from holding relevant assets.

(6B) The relevant assets in subsection (6A) are issuance by issuers which, in relation to thermal coal—

(a) derive 10% or more of annual revenue from its production, transport or combustion,

(b) produce annually 10 million tonnes or more, or

(c) have 5GW or more of power generation capacity.

(6C) Within 2 years of the Pensions Act 2025 receiving Royal Assent, and every 3 years thereafter, the Secretary of State must carry out and publish a review on whether the definition of relevant assets should be extended to include—

(a) issuance by issuers which, in relation to thermal coal, derive a smaller proportion of revenue, produce a smaller amount or have a smaller amount of power generation capacity than the proportion and amounts specified in (6B),

(b) some or all new issuance by issuers of a prescribed description deriving a prescribed proportion or amount of their revenue from the extraction, transport, trading or combustion of prescribed fossil fuels, or

(c) some or all new or existing issuance by issuers of a prescribed description investing a prescribed proportion or amount in exploring for, or expanding the extraction of, prescribed fossil fuels.

(6D) Regulations under subsection (1) may implement the conclusions of the review referred to in (6C).”

(3) In subsection (8), at end insert—

““thermal coal” means coal and lignite used in the generation of electricity and in providing heat for industrial or residential purposes;

“issuance” means all investable assets, including equity and debt.”

(4) The Financial Conduct Authority must make general rules with effects corresponding to the provisions of subsection (1) for providers of pension schemes to which Part 7A of the Financial Services and Markets Act 2000 (inserted by section 48 of this Act) applies.

(5) The Secretary of State must make regulations with effects corresponding to the provisions of subsection (1) for scheme managers of the Local Government Pension Scheme.

(6) The rules and regulations under subsections (4) and (5) must come into force no later than the date on which regulations pursuant to section 41A(6A) of the Pensions Act 1995 (as amended by this Act) come into force.”

This new clause would require Government and the FCA to make regulations and rules restricting exposure of some occupational and workplace personal schemes to thermal coal investments and to regularly review whether the restrictions should be extended to other fossil fuel investments.

New clause 20—Pensions and savings advice allowance—

“(1) The Secretary of State must by regulations make provision for a tax-free pensions and savings advice allowance which individuals between the ages of 30 and 50 can withdraw from their pensions to access financial advice.

(2) Regulations must specify—

(a) the maximum amount for the pensions and savings advice allowance,

(b) the content and scope of the pensions and savings advice,

(c) the qualifications and independence requirements of any person or body providing pensions and savings advice,

(d) the means by which individuals are notified of their entitlement to the pensions and savings advice allowance and how they may access—

(i) the allowance, and

(ii) advisers who meet the requirements under subsection (2)(c),

(e) the roles and responsibilities of pension scheme trustees, managers, and providers in facilitating access to the pensions and savings advice allowance, and

(f) whether the pensions and savings advice allowance counts towards the Individual Lump Sum Allowance.

(3) A statutory instrument containing regulations under this section may not be made unless a draft of the instrument has been laid before and approved by a resolution of each House of Parliament.”

This new clause requires the Secretary of State to introduce, by regulations, a pensions and savings advice allowance which individuals between the ages of 30 and 50 can withdraw from their pension savings tax-free to access appropriate financial advice.

New clause 21—Significant life event lump sum—

“(1) The Secretary of State must by regulations make provision for a significant life event lump sum of up to £5,000 which a person is entitled to before they attain normal pension age.

(2) The regulations may prescribe circumstances in which, and conditions subject to which, a person may become entitled to a significant life event lump sum, including—

(a) purchasing a first home;

(b) getting married;

(c) unexpected loss of employment.

(3) The regulations must specify that the significant life event lump sum counts towards the Individual Lump Sum allowance.

(4) A statutory instrument containing regulations under this section may not be made unless a draft of the instrument has been laid before and approved by a resolution of each House of Parliament.”

This new clause would require the Secretary of State to introduce, by regulations, a significant life event lump sum of up to £5,000 tax-free which individuals can take from their lump sum allowance prior to reaching pension age.

New clause 22—Indexation of pre-1997 pensions—

“(1) The Pensions Act 1995 is amended as follows.

(2) In Section 51 (Annual increase in rate of pension), omit subsections (1)(b) and (1)(c)(ii).

(3) In subsection (2), leave out from “pensionable service,” to “or”.

(4) In subsection (2), leave out from “commencement day]” to “—".

(5) In subsection (2)(b), leave out from “pensionable service” to “, so much of”.

(6) In subsection (4ZE), leave out from “pensionable service” to “in subsections (3) to (4ZD)”.

(7) In subsection (5)(a), leave out “6 April 1997 or”.

(8) In subsection (8)(a) and (b), leave out “at any time on or after 6 April 1997”.”

This new clause would remove references to 6 April 1997 from section 51 of the Pensions Act 1995 in order to require that annual increases to pension payments in line with CPI and RPI apply to pensionable service both before and after 6 April 1997.

New clause 23—Indexation of pre-1997 service—

“(1) The Secretary of State must by regulations make provision for the use of Pension Protection Fund surplus/reserve funds for the indexation on compensation in respect of pre-1997 rights for members of the Pension Protection Fund and the Financial Assistance Scheme.

(2) Those regulations must specify that—

(a) pension payments from the PPF and FAS are increased each year in line with Retail Prices Index (RPI) inflation for pensionable service before and after 6 April 1997,

(b) the cap on the annual increase is raised to 7%,

(c) where a PPF or FAS member has pensionable service prior to 6 April 1997 which has not increased each year in line with RPI inflation, the scheme manager must—

(i) determine the annual increase attributable to that service for each year since the date on which the annual payment was first payable, and

(ii) reimburse the member for the amount determined under paragraph (c)(i), and

(d) payments made to reimburse members under paragraph (c)(ii) must be made from Pension Protection Fund surplus funds and future funds.

(3) Regulations under this section—

(a) shall be made by statutory instrument, and

(b) may not be made unless a draft has been laid before and approved by resolution of each House of Parliament.”

This new clause would require the Secretary of State to provide, through regulations, for indexation on PPF and FAS compensation in respect of pre-1997 rights, for indexation to follow RPI inflation with a cap of 7%, and for retrospective payments to be funded from PFI surplus and/or reserve funds.

New clause 24—Indexation of pre-1997 pensions—

“(1) The Pensions Act 1995 is amended as follows.

(2) In Section 51 (Annual increase in rate of pension), omit subsections (1)(b) and (1)(c)(ii).

(3) In subsection (2), after “52” insert “52A”.

(4) In subsection (2), leave out from “pensionable service,” to “or,”.

(5) In subsection (2), leave out from “commencement day]” to “—”.

(6) In subsection (2)(b), leave out from “pensionable service” to “, so much of”.

(7) In subsection (4ZE), leave out from “pensionable service” to “in subsections (3) to (4ZD)”.

(8) In subsection (5)(a), leave out “6 April 1997 or”.

(9) In subsection (8)(a) and (b), leave out “at any time on or after 6 April 1997”.

(10) After Section 52 (Restriction on increase where member is under 55) insert—

“52A Restriction on increase where a pension scheme is not in surplus

No increase under section 51 in the annual rate of a pension shall not be paid or shall not be paid in full unless the pension scheme is in surplus.””

This new clause would remove references to 6 April 1997 from section 51 of the Pensions Act 1995 to require that annual increases to pension payments in line with CPI and RPI apply to pensionable service both before and after 6 April 1997, with the restriction that annual increases would only be paid if the pension scheme is in surplus.

New clause 25—Review of impact of this Act—

“(1) Within five years of the passing of this Act, the Secretary of State must carry out a review of the impact of the provisions of this Act on actual and projected retirement incomes.

(2) The review must consider—

(a) the impact of the provisions of this Act on actual and projected retirement incomes, and

(b) whether further measures are needed to ensure that pension scheme members receive an adequate income in retirement.

(3) The Secretary of State must prepare a report of the review and lay a copy of that report before Parliament.”

This new clause would require the Secretary of State to review the impact of this Act on retirement incomes and whether additional measures are needed to ensure the adequacy of retirement incomes.

New clause 26—Establishment of targeted investment vehicles for pension funds—

“(1) The Secretary of State may by regulations make provision for the establishment or facilitation of one or more investment vehicles through which pension schemes may invest for targeted social or economic benefit.

(2) Regulations under subsection (1) must specify the descriptions of targeted social or economic benefit to which the investment vehicles are to contribute, which may include, but are not limited to, investment in—

(a) projects that revitalise high street areas;

(b) initiatives demonstrating social benefit;

(c) affordable or social housing development;

(d) capital projects that meet essential public needs, such as care homes;

(e) clean, renewable energy projects.

(3) The regulations must make provision for—

(a) the types of pension schemes eligible to participate in such investment vehicles;

(b) the governance, oversight, and reporting requirements for the investment vehicles and participating pension schemes;

(c) the means by which the contribution of such investments to targeted social or economic benefit is measured and reported;

(d) the roles and responsibilities of statutory bodies, including the Pensions Regulator and the Financial Conduct Authority, in authorising, regulating, or supervising such investment vehicles and the participation of pension schemes within them.

(4) The regulations may—

(a) make different provision for different descriptions of pension schemes, investment vehicles, or targeted social or economic benefits;

(b) provide for the pooling of assets from multiple pension schemes within such vehicles;

(c) require pension scheme trustees or managers to have regard to the availability and suitability of investment vehicles when formulating investment strategies, where consistent with—

(i) their fiduciary duties, and

(ii) the long-term value for money for members.

(5) In this Chapter, "pension scheme" has the same meaning as in section 1(5) of the Pension Schemes Act 1993.”

This new clause would allow the Secretary of State to establish investment funds to encourage investment in areas such as high streets, social housing, care homes, clean renewable energy, and other investments with clear social benefits.

New clause 27—Review of proposed mandated investment powers and their impacts—

“(1) The Secretary of State must, before making any regulations under this Act relating to mandated investment requirements for pension schemes, lay before Parliament a report reviewing the potential impacts of such powers.

(2) The report under subsection (1) must include an assessment of—

(a) the extent to which any mandated investment requirements may conflict with the fiduciary duties of trustees and managers of occupational and personal pension schemes;

(b) the potential effects of such requirements on the long-term financial returns of scheme members, including—

(i) risks relating to illiquid or politically directed assets,

(ii) risks to diversification, and

(iii) any expected increase in costs borne by savers;

(c) the risk that mandated investment requirements could lead to politicisation of pension scheme decisions or undermine public confidence in the private pension system;

(d) the adequacy of parliamentary oversight and scrutiny of the exercise of powers to mandate investment allocations, including whether additional safeguards are required;

(e) the question of accountability in circumstances where mandated investments perform below expectations, including whether liability would rest with trustees, fund managers, or the Government;

(f) the potential for market distortion arising from requirements that schemes invest in specific UK-based assets, including the risk of asset inflation or the creation of investment bubbles; and

(g) alternative policy measures that could encourage pension scheme investment in the United Kingdom without the use of mandatory requirements, including the removal of regulatory barriers and the creation of suitable investment opportunities.

(3) The report must include a summary of views received from—

(a) industry bodies representing pension schemes, trustees, and fund managers;

(b) relevant financial regulators; and

(c) any other persons the Secretary of State considers appropriate.

(4) The Secretary of State must publish a response addressing the findings and any recommendations contained in the report.

(5) No regulations requiring pension schemes to meet mandated investment allocations may be made under this Act until the report under subsection (1) has been laid before Parliament and the response under subsection (4) has been published.”

This new clause requires the Secretary of State to review the potential effects of mandated investment powers including on risks to returns, fiduciary duties, market distortion, and accountability before any powers can be exercised.

New clause 28—Pension Protection Fund: members who have not attained normal pension age at assessment date—

“(1) Schedule 7 of the Pensions Act 2004 is amended in accordance with subsections (2) to (7).

(2) In sub-paragraph 3(3), for “the appropriate percentage” substitute “100%”.

(3) Omit sub-paragraph 3(4).

(4) In sub-paragraph 11(3), for “90%” substitute “100%”.

(5) In sub-paragraph 14(3), for “90%” substitute “100%”.

(6) In sub-paragraph 15(3), for “90%” substitute “100%”.

(7) In sub-paragraph 19(3), for “90%” substitute “100%”.

(8) The Secretary of State must by regulations make provision for the retrospective payment of compensation to PPF members, as if the amendments made by this section to Schedule 7 of the Pensions Act 2004 had had effect on the day on which that Schedule came into force.”

This new clause would provide that pension scheme members who have not reached Normal Pension Age by the Pension Protection Fund assessment date receive compensation at a rate of 100% instead of 90%, and provides for retrospective application.

New clause 29—Pension Protection Fund: estimate of cost of increasing compensation for surviving spouses or partners of members—

“(1) The Pension Protection Fund (PPF) must prepare and publish an annual estimate of the cost of increasing the value of compensation paid to surviving spouses or partners of PPF members to a sum equivalent to the value of any payments to which they would have been entitled had the scheme not entered the PPF.

(2) The first assessment under this section must be published before the end of the 2025/26 financial year.”

This new clause would require the Pension Protection fund (PPF) to publish annually an assessment of the costs of increasing compensation to the spouses or partners of PPF members to equal the amount they would have received if the pension scheme had not entered the PPF.

New clause 36—Local Government Pension Scheme: expenses and duties of administering authorities—

“(1) The Secretary of State must by regulations make provision for—

(a) a cap on the management expenses that can be claimed by administering authorities, such that they do not exceed ten basis points of the asset base of the pension fund,

(b) a cap on the investment management expenses that can be claimed by administering authorities, such that they do not exceed five basis points of the asset base of the pension fund,

(c) a cap on the general administrative expenses that can be claimed by administering authorities, such that they do not exceed five basis points of the asset base of the pension fund.

(2) Regulations under this section must also require administering bodies to provide to the Local Government Pension Scheme Advisory Board—

(a) evidence that they have considered and acted on any guidance issued by the Local Government Pension Scheme Advisory Board, and

(b) evidence of the steps that they have taken to comply with their fiduciary duties in respect of pension scheme members and Scheme employers.

(3) In making regulations under this section, the Secretary of State must consult the Local Government Pension Scheme Advisory Board.

(4) In this section—

“administering authorities” has the meaning given by Schedule 1 to the Local Government Pension Scheme Regulations 2013, and

“Scheme employer” has the meaning given by Schedule 1 to the Local Government Pension Scheme Regulations 2013.”

Amendment 1, in clause 1, page 3, line 7, at end insert “, or

(b) secure employee representation on the company’s board.”

This amendment would add employee representation on boards as a requirement on asset pool companies for Local Government Pension Schemes within the scheme regulations under clause 1.

Government amendments 20 and 21.

Amendment 2, in clause 2, page 4, line 7, at end insert—

“(ba) the funds or other assets for which a scheme manager is responsible (other than money needed for making payments under the scheme from the pension fund maintained by that scheme manager) should be invested in a way that is compliant with the UK’s duty not to aid or assist serious breaches of international law, including genocide and other atrocity crimes, and illegal military occupation.”

This amendment would require that investments of the local government pension scheme should be compliant with the UK’s duty not to aid or assist serious breaches of international law.

Amendment 3, page 4, line 7, at end insert—

“(ba) the funds or other assets for which a scheme manager is responsible (other than money needed for making payments under the scheme from the pension fund maintained by that scheme manager) must be divested from any oil and gas companies within 5 years of the passing of this Act.”

This amendment would require that local government pension schemes divest from oil and gas companies within 5 years.

Government amendments 22 and 23.

Amendment 17, in clause 9, page 9, line 25, leave out from “does” to the end of line 25 and insert

“apply to a scheme that is being wound up unless the trustees determine by resolution that it shall not apply.”

This amendment would ensure that the principles for surplus extraction shall also apply to surplus release after further wind-up, so that employers are not incentivised to wind-up funds rather than release surplus to pensioners.

Amendment 18, in clause 10, page 10, line 21, after “notified” insert “and consulted”

This amendment would ensure that members of pension funds have to be consulted on surplus extraction.

Amendment 4, page 10, line 36, at end insert—

“(e) about the proportion of any surplus that may be allocated, or the manner in which it may be determined, for the purpose of contributing to the provision of free, impartial pension advice and guidance services for scheme members.”

This amendment enables a proportion of surplus funds to be used to fund free pension advice.

Amendment 19, page 10, line 36, at end insert—

“(e) that the trustees are satisfied that it is in the interests of the members that the power to pay surplus is exercised in the manner proposed;

(f) that the trustees have taken full account of—

(i) the extent to which members’ pensions have kept up with the cost of living and inflation (as defined in the relevant rules and deeds), and

(ii) any previously rejected requests for discretionary pension increases.”

This amendment would reinstate the current requirement that ensures trustees consent to the paying of surplus as proposed, and creates an obligation on trustees to take account of any erosion in members’ standards of living.

Amendment 5, in clause 11, page 11, line 38, at end insert—

“(aa) make, publish and keep under review the consistency of—

(i) regulated VFM schemes, or

(ii) regulated VFM arrangements,

with the goals of the Paris Agreement on climate change and clean energy;”

This amendment would require pension funds and managers to show whether their portfolio investments are consistent with the Paris Agreement.

Amendment 6, page 11, line 38, at end insert—

“(aa) make, publish and keep under review the compliance of—

(i) regulated VFM schemes, or

(ii) regulated VFM arrangements,

with statutory and regulatory targets for reducing sewage discharges by water and sewerage undertakers,”

This amendment would require pension funds and managers to monitor and report on the compliance of water and sewerage companies they invest in with targets for reducing sewage discharges.

Amendment 7, page 12, line 10, at end insert—

“(d) publish or share with prescribed persons, for the purpose of enabling VFM assessments to be made, prescribed categories of information (referred to as “climate alignment metric data”) regarding the scheme’s exposure to climate-related financial risks and the alignment of its investments with the goals of the Paris Agreement on climate change and clean energy.”

This amendment, with Amendment 5 would require pension funds and managers to show whether their portfolio investments are consistent with the Paris Agreement.

Amendment 8, page 12, line 10, at end insert—

“(d) publish or share with prescribed persons, for the purpose of enabling VFM assessments to be made, prescribed categories of information (referred to as “sewage discharge compliance data”) regarding the scheme’s exposure to, and investment in, companies holding permits to discharge sewage, including those companies’ performance against statutory and regulatory targets for reducing sewage discharges.”

This amendment, with Amendment 6, would require pension funds and managers to monitor and report on the compliance of water and sewerage companies they invest in with targets for reducing sewage discharges.

Amendment 9, page 12, line 41, leave out “that provides money purchase benefits”

This amendment, together with Amendment 10, would ensure that the value for money provisions introduced by this Bill apply to all occupational pension schemes.

Amendment 10, page 13, line 5, at end insert—

“(14) Value for money regulations may make different provision for different descriptions of relevant pension schemes and must make provision for the application of the value for money assessment with a VFM rating to defined benefit occupational pension schemes.”

This amendment, together with Amendment 9, would ensure that the value for money provisions introduced by this Bill apply to all occupational pension schemes.

Amendment 11, in clause 13, page 14, line 13, at end insert—

“(iv) the consistency of the investment portfolio with the goals of the Paris Agreement on climate change and clean energy, including metrics for assessing climate-related financial risks and opportunities;”

This amendment would require pension funds and managers to show whether their portfolio investments are consistent with the Paris Agreement.

Amendment 12, page 14, line 13, at end insert—

“(iv) the compliance of the investment portfolio with statutory and regulatory targets for reducing sewage discharges by water and sewerage undertakers, including metrics for assessing related environmental and financial risks and opportunities;”

This amendment would require pension funds and managers to monitor and report on the performance of water and sewerage companies they invest in against targets for reducing sewage discharges.

Government amendments 24 to 49.

Amendment 16, in clause 40, page 43, line 38, leave out from beginning to end of line 27 on page 46.

This amendment would remove the ability of the Government to set mandatory asset allocation targets for certain pension schemes, specifically requiring investments in UK productive assets such as private equity, private debt, and real estate.

Amendment 15, page 46, line 9, leave out from “Before” to the end of the subsection and insert

“implementing the first set of regulations under subsection (1) the Secretary of State must—

(a) prepare and publish a report regarding—

(i) what barriers pension funds, based in the United Kingdom, are facing that are preventing them from investing back into the United Kingdom due to—

(A) legislation introduced after The Pensions Act 1995;

(B) regulations introduced by the Financial Conduct Authority, Prudential Regulation Authority, HM Treasury, or Bank of England;

(C) cultural and market behaviours;

(ii) how financial interests of members of relevant Master Trusts and group personal pension schemes would be affected by the proposed regulations;

(iii) what effects the proposed measures could be expected to have on economic growth in the United Kingdom;

(iv) any other matters the Secretary of State considers appropriate; and

(b) respond to any recommendations or issues raised in the report.”

This amendment prevents use of the reserved mandation powers in this Bill until the Government produces a report on the reasons why the powers are needed and the effects of the use of the powers and resolves any issues raised in the report.

Amendment 14, page 48, line 15, leave out paragraphs (a) to (c) and insert—

“(a) The scheme in question demonstrates strong potential for growth and an ability to innovate, and”

This amendment would revert the text of section 28F(2) on the eligibility conditions for new entrant pathway relief to its form in the Bill as introduced.

Government amendments 50 to 85.

Amendment 13, in clause 117, page 120, line 19, leave out “2035” and insert “this Parliament”

This amendment provides that if section 40 is not commenced before the end of the current Parliament in respect of the insertion of certain provisions, then the insertion of those provisions would be automatically repealed at that time.

Government amendments 86 to 89.

[Torsten Bell]

I start by thanking all hon. Members for their valuable contributions during the Bill’s passage to date. In particular, I thank members of the Public Bill Committee who offered line-by-line scrutiny. They have challenged the Government, but always constructively—that includes the shadow Economic Secretary to the Treasury, the hon. Member for Wyre Forest (Mark Garnier), who is not with us today. That reflects the broad consensus across the House that the Pension Schemes Bill is an important piece of legislation, and it is a consensus for which I am very grateful. The same consensus underpinned the introduction of automatic enrolment under the previous Government.

It is exactly because we as legislators have more than gently nudged people into pension savings that the Bill’s most fundamental job is to drive up returns on those savings. The case for this focus is clear: those retiring in 2050 are currently set to do so with lower private pension income than those retiring today. The Bill also recognises that, with the second largest pension system in the world, pensions matter not just to deliver an income in retirement but for the whole economy as the largest source of domestic capital. With those goals in mind, this Bill builds a solid foundation on which we can build, not least via the Pensions Commission over the next year, exactly as several hon. Members called for on Second Reading.

The vast majority of the amendments tabled by the Government are minor technical amendments, and there are two substantial areas on which I would like to dwell. The first is on pre-1997 indexation within the Pension Protection Fund and the financial assistance scheme.

The PPF is one of the most important legacies of the last Labour Government, but we have all heard about the challenges caused by the lack of indexation of compensation related to pre-1997 pensions. I am grateful for the time that affected pensioners have given me in discussing their experiences directly. I have listened carefully to them and to hon. Members who have kept attention on this issue.

I particularly acknowledge the contribution of my hon. Friend the Member for Oldham East and Saddleworth (Debbie Abrahams) and her Work and Pensions Committee, as well as my hon. Friend the Member for Basingstoke (Luke Murphy) and the hon. Member for Aberdeen North (Kirsty Blackman) who raised this matter in Committee. I am also grateful to the hon. Members for Didcot and Wantage (Olly Glover), for Caerfyrddin (Ann Davies), for Torbay (Steve Darling) and for Belfast South and Mid Down (Claire Hanna), and my hon. Friend the Member for Poole (Neil Duncan-Jordan), for their proposed new clauses and amendments related to this matter.

--- Later in debate ---

[Dame Nia Griffith]

I thank the Minister for that, but it is a matter of action and ensuring that it really happens. We are too used to regulators not having the powers they are supposed to have or not being effective in using them. We need some action, and hopefully the Minister will help us to see how it could be done.

There is a bitter irony that the Pension Protection Fund is funded by a levy on the very same companies that are refusing to index-link their own pensioners’ pensions. We know from lots of evidence that the only way the companies will listen is through legislation. These companies are multinationals, and in countries where there is legislation, they pay up—so they do respond if there is a law.

As I was saying, saying that the trustees have the powers is sadly very far removed from the reality. Trustees of various countries have asked repeatedly for indexation, and before handing over any surplus to the companies, they will be very wary because they do not trust them at all. They will want cast-iron guarantees on indexation.

Let us look at the scale of the problem. Seventy-five per cent of UK defined-benefit schemes already provide pre-1997 indexation. The remaining 25% represents approximately 1.5 million members, including some 734,000 pensioners, with 80% of all pensioners concentrated within just 200 large schemes with strong employers. As we have seen, employer discretion has failed in practice, and many pensioners have had years of zero increases.

New clause 22 would set the statutory principle that there should be indexation. The Government can then design proportionate safeguards—for example, phasing in, exemptions and triggers—in order to protect genuinely weak schemes and to ensure, as the Society of Pension Professionals says, that schemes are not pushed into having to be picked up by the Pension Protection Fund.

We want action on this. We are talking about a small, manageable number of schemes, but we want the trustees really to be given the powers to force those companies to make that indexation. If the Minister is not minded to put this provision into the legislation, as we want, we want to see some concerted action and a genuine way forward. If that proves not to work, there needs to be an opportunity to come back and put this into secondary legislation instead.

[Madam Deputy Speaker (Caroline Nokes)]

I call the Liberal Democrat spokesperson.

[Steve Darling]

For people who are lucky in the lottery of life, their pension can be one of their biggest assets, but, sadly, we know that 12 million people across the United Kingdom are not saving enough. That is around the population of Belgium. Talking more broadly, there is much about the legislation to be welcomed. I am sure the Minister had his best birthday ever by spending it in the Bill Committee. I am sure that as a 14-year-old, he dreamed of that day, on Committee corridor—sadly I am not joking.

Budget Resolutions

Caroline Nokes Excerpts

Thursday 27th November 2025 Commons Chamber

[Several hon. Members rose—]

[Madam Deputy Speaker (Caroline Nokes)]

Order. In an attempt to get everybody in today, I am going to put an immediate six-minute time limit on speeches.

--- Later in debate ---

[Sir Geoffrey Clifton-Brown]

No, I have already given way once on this subject.

Our wealth creating sector is shrinking, whereas the public sector is ballooning, yet the Government’s policies are punishing businesses and wealth creators. The freezing of tax thresholds is a tax rise, as the Chancellor has confirmed many times at the Dispatch Box, but she has now confirmed that they will be frozen for another three years. Every time they are frozen, that brings more people into the tax net. In this case, it is forecast to bring another 750,000 into the tax net. The 2% increase on savings and dividends is another penalisation of those working hard to save their money. Where are the incentives to save money if the Government are taking more of their savings?

Finally, hospitality businesses are going to be hit hard by this Budget. In North Cotswolds, they are at the heart of the community, yet nationally one pub is closing its doors every day at the moment. I do not see any pub landlords welcoming this Budget—

[Madam Deputy Speaker (Caroline Nokes)]

Order.

--- Later in debate ---

[Monica Harding]

I do not have the time.

Older homeowners who have watched their properties’ value soar over the years will be hardest hit by this granny tax. They are asset-rich but cash-poor. They may be forced to sell up—at reduced asking prices—and more properties will get dragged into the mansion tax net. As that happens, a proportion of terraced houses, flats and semis will join them.

Worst of all, this is not a serious attempt to reform property tax, including business rates, stamp duty and council tax. Like the Budget, it is tinkering and meddling around the edges. This is a patchwork Budget that does not take us much further forward. Where has the national mission for growth gone? This is a low-growth Budget from a low-growth Government who thumb their nose at the wealth creators. It does not tackle some of the big questions. Where is the money in the plan for adult social care? Where is the money in the plan for the £14 billion deficit in SEND provision to help local authorities that are about to go bankrupt? The Budget is a smorgasbord of contempt for aspiration and growth. The Government have not only abandoned working people in my constituency, but waged a quiet war on aspiration itself.

I am pleased that the Government have lifted the two-child benefit limit. [Hon. Members: “Ah!”] My party laid out how we would do that, but Government Members know as well as I do that poverty does not end there. To tackle poverty, we need to create growth.

There is an alternative, which the Liberal Democrats have laid out in our plan to turbocharge economic growth by repairing the £90 billion Brexit black hole caused by the previous Conservative Government. The UK needs to negotiate a new bespoke customs union with the European Union: a modern arrangement designed around the needs of British businesses and workers, which would raise £25 billion a year. Instead of that we have a Budget that taxes work, punishes investment, stifles aspiration and still fails to deliver for public services; a Budget that tells wealth creators—

[Madam Deputy Speaker (Caroline Nokes)]

Order. I call Graeme Downie.

--- Later in debate ---

[Several hon. Members rose—]

[Madam Deputy Speaker (Caroline Nokes)]

After the next speaker there will be a five-minute time limit.

--- Later in debate ---

[Bradley Thomas]

My right hon. Friend is absolutely correct. The Government have a duty, in every single thing that they do and in their entire approach, to ensure that they promote the interests of the UK and of the businesses and farms that strive to keep us fed and prosperous.

Unemployment is up and redundancies are rising. In my constituency, local employers are cutting jobs, leaving families anxious about their future. Spending is up, and borrowing overshot forecasts by £9.9 billion this year. My constituents know that every pound borrowed today is a pound that they will repay tomorrow. Confidence is down, with business surveys showing stagnation, and local shopkeepers tell me that they are holding back investment because they see no stability. Growth is also down, with GDP growing by just 0.1% in Q3 of this year. My constituents see stagnation in wages, stagnation in opportunity and stagnation in hope.

This is Labour’s economic scoreboard: inflation is up, taxes are up, unemployment is up, spending is up, borrowing is up, confidence is down and growth is down. That is not rebuilding Britain; it is dismantling Britain’s prosperity, and all our constituents are paying the price. Two thirds of the British public now say that they want to see spending cuts. My constituents are tightening their belts, and cutting back on holidays and meals out. Some are even cutting back on heating. They expect the Government to do the same and to live within their means, yet Labour’s Budget expands spending recklessly.

Businesses in my constituency are being hit hard. Last year, employer national insurance contributions were increased and business rates relief was cut, and businesses are struggling to survive. For savers, ISA allowances have been reduced, which undermines savings. Retail has lost over 100,000 jobs in the last year. With our high streets feeling the pain, shops are closing and livelihoods are being destroyed. The Budget offers no relief for small businesses in my constituency; it only offers more burdens.

Labour claims that fairness is at the heart of the Budget, but fairness is not what families in my constituency are feeling. Income tax thresholds have been frozen, dragging more workers into higher tax bands, and savers have seen their allowances cut. Even electric car owners, who have been encouraged to go green and to do the right thing, are now being penalised. This punishes aspiration.

Farmers in my constituency are among the hardest hit, and the family farm tax remains largely intact. The changes to inheritance tax threaten the survival of the family farm, and rising input costs and inflation are compounding the pressure. Farming is not just an industry; it is the backbone of our food security, as my right hon. Friend the Member for South Holland and The Deepings (Sir John Hayes) pointed out, and the backbone of rural life, yet Labour continues to undermine it.

We are seeing an exodus of capital and labour in a world that is highly mobile. Over the last year, we have seen an exodus of high-net-worth individuals. While Labour Members may scowl at and casually dismiss that, the reality is that the displacement of those individuals would require another half a million average earners paying tax to plug the gap of tax revenue lost. That is the scale of the hole that the Government have created. Who will fill that? All of our constituents will—ordinary families, ordinary workers and ordinary savers.

Ambition without discipline is not a plan; it is a gamble. Labour’s Budget is a gamble with Britain’s future. Every £1 spent servicing debt is £1 not spent on public services, every broken promise erodes trust and every squeeze on families and businesses undermines the engine of our economy. Let us be clear: Labour spends until it runs out of other people’s money, and when the money runs out, our constituents pay the price. All of our constituents deserve better than what we have seen in this Budget. They deserve a Government who will restore fiscal discipline, encourage enterprise and deliver fairness for everyone.

Yesterday’s Budget is not a plan for the future, but a blueprint for decline. It ignores the public’s demand for spending cuts and for the Government to live within their means. It presides over the loss of further jobs, and it drives away wealth creation, leaving ordinary taxpayers to pick up the bill. It squeezes families, undermines businesses and will devastate farmers. This is not rebuilding Britain; this is dismantling Britain’s prosperity. Labour spends until it runs out of other people’s money, and my constituents cannot afford that any longer.

[Madam Deputy Speaker (Caroline Nokes)]

I call Perran Moon.

--- Later in debate ---

[Ben Obese-Jecty]

I wholeheartedly agree. I have spent the last year talking to small businesses in my constituency that have been crippled by the measures in the last Budget. When this year’s measures come in as well, some of those businesses will struggle desperately to keep on lower earners, particularly young people.

My first job as a 16-year-old was working in a supermarket, and I am sure many Members had a similar experience. Those opportunities are going to disappear for young people as a result of these measures. What this Labour Government have not taken into account is that every above-inflation wage increase leads to higher business costs, lower investment and fewer opportunities for those we represent. Many businesses that want to employ people will now find themselves unable to take on staff or to take the risks that the Chancellor mentioned, meaning that businesses cannot grow.

We are very likely to see the wage compression effect, whereby the gap between those on the minimum wage and those in more skilled or experienced roles becomes smaller. That, yet again, leads to a lack of incentive to develop skills and opportunities for those with them. The Government must address that, as it will curtail opportunities for young people and lower earners. Unemployment is now set to peak at 5% and the number of economically inactive people will also rise.

The pay-per-mile tax on electric vehicles will surely disincentivise the switch to EVs before the ban on new petrol and diesel vehicles kicks in, and the OBR estimates that there will be 440,000 fewer EV sales over the next five years because of the tax. How much tax revenue will be lost because those sales never happen? Then there is the plethora of other taxes that are part of the smorgasbord: the tourism tax, the NI raid on pension contributions, the reduction in the tax-free cash ISA allowance and even a milkshake tax.

We have not even touched on the absence of the commitment to 3% of GDP on defence anywhere in the Budget. There is not a single reference to it and I do not understand how. We saw today that the service chiefs will write to the Defence Secretary to tell him that it will not be possible to deliver the strategic defence review. I would love to hear from the Minister how Labour will facilitate defence in this day and age.

The OBR has stated that not a single measure contained in the Budget will improve growth, which has, in fact, been downgraded from the figure forecast in the summer. Taxes on working people have been increased by stealth to pay for welfare. That will be Rachel Reeves’s legacy, and this is quite possibly her last Budget—

[Madam Deputy Speaker (Caroline Nokes)]

Order. You can refer to the Chancellor of the Exchequer as the Chancellor or by her constituency name, but not by her own name.

[Ben Obese-Jecty]

I apologise, Madam Deputy Speaker. I shall draw to a close.

It comes to something when the Chancellor can stand at the Dispatch Box to deliver her Budget, make a boob joke and that not be the most offensive thing she says.

Welfare Spending

Caroline Nokes Excerpts

Tuesday 15th July 2025 Commons Chamber

[Brian Leishman]

I thank the hon. Gentleman for that point, which I will come on to. He has clearly had advance sight of my speech.

The Government should of course lift the two-child cap immediately, and it was wrong of them not to make that a part of the King’s Speech.

The wording in the motion referring to a “benefits culture” is both lazy and classist, not to mention demonstrating the ignorance—wilful or otherwise—of the Conservatives about the struggles experienced by millions in this country. However, I expect that from some in the Conservative party. I agree that the welfare system is broken and that it needs changed, but the changes it needs are not to be found in this motion or in what the Government put before the House last week. Like thousands of my fellow party members, I do not expect that from the Labour party. Last week’s vote was a stain on a great party that should be defending and fighting for the people that this motion seeks to belittle.

Improving living standards should be the priority of this Government and every Government, and we are not doing nearly enough—not yet. A year into this Government, what people need is not MPs creating a living standards coalition group; they need them voting in this place to improve living standards, not writing letters about improving living standards. After last week’s vote, which came too late for disabled people, I urge MPs to wake up before making the same mistake again.

I urge the Government to resist going down the road of pitting old people against children or children against striking workers, or any of that nonsense. Leave that division and nastiness to other parties that seek to divide and conquer and create inequality.

[Madam Deputy Speaker (Caroline Nokes)]

I call the shadow Minister.

--- Later in debate ---

[Peter Swallow (Bracknell) (Lab)]

I would like to clear up what this Prime Minister and Government have done. They have expanded eligibility for free school meals to include more than 3,000 children in Bracknell Forest; expanded Best Start family hubs, which is something the previous Government never funded in Bracknell Forest; expanded the warm home scheme; rolled out free breakfast clubs in primary schools; limited expensive school uniforms to three branded items—

[Madam Deputy Speaker (Caroline Nokes)]

Order. The hon. Gentleman should know that interventions must not be his speech read out at speed.

--- Later in debate ---

[Iqbal Mohamed (Dewsbury and Batley) (Ind)]

According to the latest DWP data, more than 11,800 children in my constituency of Dewsbury and Batley are living in poverty. This is not abstract and it is not inevitable; it is a direct result of policy choices by the previous Government and the maintenance of that policy by the current Government. One parent shared—

[Madam Deputy Speaker (Caroline Nokes)]

Order! May I please urge people to make interventions short and pithy and not pre-prepared and read out.

[Danny Kruger]

I will come in a moment to the matter of child poverty, and I recognise the point that the hon. Gentleman is making.

I was just referring to the fact that all the parties except ours—indeed, it is unclear what those on the Government Front Bench think—seem to support lifting the two-child cap. The Liberal Democrats cannot seem to see a spending opportunity without grabbing it with both hands. Their spokesman, the hon. Member for Torbay (Steve Darling), spent £4.5 billion just in his speech earlier this afternoon. Then we have the SNP Government, who have presided over higher economic inactivity and lower employment than in England, have missed all their targets for child poverty, and still clamour for more money for welfare.

Then there is the Reform party, which is sadly absent today. I do quite like the Reform party and I agree with its Members on lots of things, but there is a problem: they would spend money like drunken sailors. I can see what is happening and I am very worried about it—they will end up in an electoral pact with the Liberal Democrats with a joint ticket to protect welfare spending. I do not know how hon. Members feel about the anticipated alliance.

The hon. Member for Dewsbury and Batley (Iqbal Mohamed) and others, particularly Members on the Government Benches, have cited widening poverty rates over the past decade or more, and they repeatedly raised the issue of 4.5 million children, but they are talking about relative poverty. The fact is that relative poverty increased under the previous Government because, overall, the economy grew, as more people became more prosperous. As the median income rises, more people come under it; that is how it works. If relative poverty goes down under this Government, it will be because they shrank the economy. That is highly likely, but it is not an achievement to boast about.

Relative poverty is not a measure of anything except the operation of the law of averages. Therefore, what we need to look at is real poverty, absolute poverty. As we rescued the public finances and grew the economy, absolute poverty went down under the Conservatives.

On children, the percentage of children in absolute poverty after housing costs fell between 2010 and 2024. We pulled 800,000 people out of absolute poverty and averted over a million more people falling into absolute poverty. We had more people in work, a higher employment rate, and fewer workless households than since records began. We should thank my right hon. Friend the Member for Chingford and Woodford Green (Sir Iain Duncan Smith) for that. Mention was made of Wilberforce and Disraeli. One day they will add the name of Duncan Smith to that great record.

[Madam Deputy Speaker (Caroline Nokes)]

Order. That should have been “the right hon. Member for Chingford and Woodford Green”.

[Danny Kruger]

It just doesn’t flow as well, but yes, apologies Madam Deputy Speaker.

--- Later in debate ---

[Graham Stuart]

On a point of order, Madam Deputy Speaker. Given collective responsibility, is it in order for a Minister of the Crown to argue against a policy of his own Government? If I have understood correctly, it is the policy of the Government and the Labour party to maintain the two-child benefit cap.

[Madam Deputy Speaker (Caroline Nokes)]

Order. The right hon. Gentleman will know that that is not a matter for the Chair, and he is seeking to drag me into the debate.

[Andrew Western]

It is also not what I said, Madam Deputy Speaker. I said that we on our child poverty taskforce are considering all available levers in the lead-up to the child poverty strategy, which will come in the autumn.

The Opposition spokesperson, the hon. Member for East Wiltshire (Danny Kruger), made a point about controlling welfare spend. Yet again, we heard that the four years post-covid were not an appropriate time to tackle the spiralling welfare bill that the Conservatives created. In those four long years, the Conservative party got through three Prime Ministers, five Ministers for health and work, six Secretaries of State for Education and seven Sunak resets, yet the welfare bill continued to spiral. Child poverty worsened, and we had wasted years, so we will take no lectures from the Conservatives on welfare spend, and certainly not on the best way to tackle child poverty.



This party inherited the Conservatives’ shameful legacy of disastrous levels of child poverty and a broken social security system that fails to command people’s trust. Across Government, we have started the urgent work to fix these problems and to drive down child poverty once again, as the last Labour Government did, in partnership with the devolved Administrations, charities, local authorities and others, and to build a fairer, more sustainable social security system that helps people build better lives by giving them the right incentives and support. We will do that important work because tackling child poverty is a moral mission for this Government, and we will oppose this motion today because all levers are under active consideration as we seek to do so.

[Madam Deputy Speaker (Caroline Nokes)]

Before I put the Question, I will just remind the Minister that, like the shadow Minister, he should not be referring to Members by their name in the Chamber but by their constituency.

Question put.

Universal Credit and Personal Independence Payment Bill

Caroline Nokes Excerpts

Committee of the whole House & 3rd reading
Wednesday 9th July 2025 Commons Chamber

[Several hon. Members rose—]

[The Second Deputy Chairman of Ways and Means (Caroline Nokes)]

Before I call the next speaker, may I remind all Members that this is the Committee stage? Can we have some focus on the amendments we are debating this afternoon, not wide-ranging Third Reading speeches? At this rate, there will be little time for Third Reading.

[Iqbal Mohamed (Dewsbury and Batley) (Ind)]

I rise today to speak in support of amendments 2(a), 37 and 39, and new clauses 8, 10 and 11. Without going into a Third Reading speech, it is important to highlight that we are debating a Bill that will have a profound and, in many cases, devastating impact on thousands of families across our country.

As the Resolution Foundation puts it, this Bill represents an

“income shock for millions of low-income households.”

That should give every Member in this Chamber pause. What is particularly troubling is that the areas hardest hit are the very communities that this Government claim to support—places in the north of England, in Wales and in my region of Yorkshire. These proud working-class areas are being failed by a Government tightening the purse strings on the most vulnerable.

In Dewsbury and Batley, 7.9% of people claim personal independence payment. I have had more than 150 constituents contact me terrified about what these cuts mean. Those are not just numbers; they are real people with real needs. The universal credit health element is an essential lifeline for millions of people in our country. One of my constituents, Andrew Waring, ran a business before 2020. Then covid left him with long-term organ damage. He could barely walk 10 metres, and his PIP payments became a lifeline. Cutting such support is not about trimming fat; it cuts into people’s dignity and survival. More than 20 civil society organisations have urged MPs to reject these cuts. Even with the Government’s amendments and the change introduced last week to defer any cuts to PIP until the Timms review has concluded, people are still left concerned and in severe distress.

As it stands, clause 2 will leave 750,000 people, according to the Government’s impact assessment published last night, up to £3,000 worse off by 2030. One in five people on universal credit and disability benefits have used a food bank in the past month, and this Bill will just increase that number. That is why I support amendment 2(a) tabled by the hon. Member for Leeds East (Richard Burgon) to maintain the current universal credit health element. That cut will especially hurt people with mental health conditions who are already struggling to access support.

Many Members across the House have spoken in support of the other amendments that I also support, and I will not repeat their eloquent and informed speeches and the points they made. To conclude, what has been disappointing at the end of my first year in Parliament is to see a critical Bill, which will impact millions and millions of people in our country, rushed through the legislative process in a way that has not allowed the relevant time to understand, amend and improve it so that it is fit for purpose. I am sorry to say so, but this process has been a legislative mess.

--- Later in debate ---

[Several hon. Members rose—]

[The Second Deputy Chairman of Ways and Means (Caroline Nokes)]

I understand that Sir Roger may already have made this point, but about 23 colleagues are still waiting to speak and we have roughly 88 minutes left. At four minutes each, most of you will get in. If you choose to take eight minutes each, half of you will get in. I will allow colleagues to make the decision as to whether they wish to help each other.

[Steff Aquarone (North Norfolk) (LD)]

It is an honour to follow the hon. Member for South West Norfolk (Terry Jermy), who is my constituency neighbour. I welcome and value his testimony and his authenticity of purpose in what he said.

I wish to speak in favour of my new clause 5, which I am pleased to say has been supported by many of my colleagues representing both inland and coastal communities. My new clause would require the Government to publish, within six months of the Bill passing, an assessment of how its provisions impact on coastal communities, such as mine in North Norfolk. That is really important, because this Bill could have a huge and detrimental impact on such communities, and I am deeply concerned that the Government have once again failed to consider coastal communities in their policy. I have heard from hundreds of worried constituents, and I am sure that the same is true of my coastal colleagues from across the House—we all know that our areas are too often overlooked and not valued enough by Governments. My new clause would ensure that the Government have to take account of how our areas will be particularly harmed by such badly thought-out changes.

What is on the face of the Bill as it stands will be really damaging to our coastal regions, even if we accept the Government amendments. Some of the highest rates of PIP claims are in coastal communities, as are some of the highest rates of unemployment. Considerably above-average rates of sickness, poor health and lower quality of life are found in coastal communities. If the Government press ahead with such blunt changes without supporting more people into work first, it could be catastrophic for communities all around our coastline.

Communities who are eager to get into work are faced with a litany of barriers that the Government are not doing enough to solve. We have real issues with public transport access, so for many trying to access inland employment, it is either too far or too hard to get to many jobs, or they see their pay packets eaten into disproportionately by bus or train fares. Almost one in five unemployed people have not applied for jobs or have turned down offers due to problems with transport.

This problem is even more acute among young people—both employed and not—who are nearly three times more likely than their older working age peers to turn down a job because they simply cannot get to it. These struggles extend to those accessing vocational training, which can be a new route into new trades and qualifications that are simply not accessible for many due to the distances required, or the lack of a workforce to provide the training. We have many talented people currently in receipt of PIP or UC who would be eager to train for an industry that they feel could allow them to work, but in communities such as mine the opportunities are just too lacking.

We know that the welfare system is not working—that is clear—but the Government have to stop looking at this issue as mere numbers on a balance sheet. When the Government do that and just look at ways to get to a magic number demanded by the Treasury, they ignore the people behind the numbers. There is an urgent need to tackle underemployment and, in particular, the rise in the number of young people with mental ill health being sentenced to a lifetime of worklessness. But ripping out the safety net will do nothing to help young people in coastal communities such as mine, who are three times as likely to suffer from undiagnosed mental distress than their inland equivalents in underprivileged areas.

Pension Schemes Bill

Caroline Nokes Excerpts

2nd reading
Monday 7th July 2025 Commons Chamber

[Several hon. Members rose—]

[Madam Deputy Speaker (Caroline Nokes)]

Order. Before I call the next speaker, I just want to be clear that it will be about an hour before the wind-ups. Nine Members are bobbing, so perhaps you can all reflect on that in your contributions so that I do not have to put on a time limit.

--- Later in debate ---

[Jim Shannon (Strangford) (DUP)]

It is a real pleasure to speak on this Bill. Pensions and the regulation of private pensions are increasingly of national interest. I believe that regulation is needed, so I welcome the Bill. Obviously the small print will become more apparent during its passage, but it is good that we are introducing the Bill.

The Government’s intention of ensuring that people have a private pension to supplement their income when they eventually reach retirement is increasingly being realised. By and large, most young people—22 million, I understand—have a pension. The Minister will remember the story I told him about when I was 18. I think I am right in saying that I am the oldest person in this Chamber, so that was not yesterday. The fact is that pension advisers were almost unheard of then. I will tell hon. Members who the best pension adviser I ever had was: my mum. When I was 18, she took me down to the pension man in Ballywalter. She said, “You need a pension.” I said, “Mum, I’m only 18. What do I need a pension for?” She said, “You’re getting a pension.” We know how it is: our mum tells to do something, and we just do it, so I got a pension on her advice.

I ended up with four pensions over my working life, which were all beneficial. I did not understand the value of them until I came to the stage at which I was going to cash some of them in—I realised the value of them then. Today, we have an opportunity to advise young people of the need for a pension. When it comes to pensions, not everybody has my mum, but everybody has somebody, or an equivalent through Government.

Let me give a quick story about my office staff. I employ six ladies and one young fella. They are in their 20s, 30s, 40s, 50s and 60s. I will not get into trouble by naming the staff in each bracket, but their approach to their pension varies by age bracket, and that is a fact; they see it differently. Listening to their discussion highlighted to me the need to educate people on the importance of paying into their pension, because it is so important that we get this right. That is why the Bill is important: it is an opportunity to advise people.

One member of my staff has two children at primary school. She highlighted that she was paying an additional 5% into her pension on the advice of her older colleague, only to find that the tax on her savings this year meant that she actually had less money in her account each month compared with last year. The first thing to go was not the kids’ piano lessons or hockey camp—she said that those experiences shaped her children’s memories. The first reduction was scaling back on her pension additions. People might say, “My goodness me! That was not necessary,” but actually it was, if she wanted to preserve that lifestyle for her children. It seems that the tax on savings means that one mum has made the choice to stop supplementing her pension, and to instead sow the money into her children’s lives just now. That is not the aim of the Government or the Minister, but there is only so much that we can tax the middle class before they make cuts that are not in their best interests.

Apart from a number of clauses, this legislation does not directly affect Northern Ireland, but it should be noted that accompanying legislation and a number of legislative consent motions—statutory instruments—will come to this Chamber that will change the pension schemes in Northern Ireland. Ultimately, what we discuss here and what happens through this Bill will come to us in Northern Ireland, and the Northern Ireland Assembly will bring provisions in Northern Ireland in line with those here. I have therefore considered carefully the aims of this legislation, and whether I believe it will be effective in achieving those aims. The Minister has said that this Bill will fundamentally

“prioritise higher rates of return for pension savers, putting more money into people’s pockets in a host of different ways. For the first time we will require pension schemes to prove they are value for money, focusing their mindset on returns over costs and protecting savers from getting stuck in underperforming schemes for years on end.”

When we look at the issues, we understand the necessity for the Bill.

In his introduction, the Minister referred to 13 million small pension pots floating about in the UK pension system, with £1,000 in each. It seems logical to have a better pension system for people—I think it does, anyway, and maybe we all do. It is essential that the opt-out is iron-clad, and I will give a reason why. One of my office staff members would not be comfortable with her pension paying into any companies that test on animals, for example. Another has said that she wants the highest return, full stop, so we must ensure that the Bill enables people to follow their moral obligations as well as get a return on their work. I am concerned that consumers will be tied down and face difficulty in leaving pots, which is something that must be addressed. With that in mind, I welcome this Bill to regulate the pension market, but we must ensure that it does not become a mechanism for Government to control the private pension industry and direct pension pots into Government investment. We must ensure that this Bill simply protects pensioners, and I very much look forward to watching its progress.

[Madam Deputy Speaker (Caroline Nokes)]

I call the shadow Minister.

[Rebecca Smith (South West Devon) (Con)]

It has been a privilege to hear so many well-informed and considered speeches this evening. I am sure we would all agree that there is clearly significant expertise in the Chamber.

The heart of this Bill is people doing the right thing by preparing for their future and saving into their pension pots. With auto-enrolment having been introduced by the Conservatives in 2012, there are now over 20 million employees saving into a workplace pension. That is 88% of eligible employees saving into a pension and preparing for later in life, which is a great achievement that I hope everyone in this House can celebrate. However, while the number of people who are saving has increased significantly, engagement has remained low, as we have heard this evening. Less than half of savers have reviewed how much their pension is worth in the past 12 months, while over 94% of pension savers are invested in a pension scheme’s default investment strategy. With people taking the right steps and starting to save for their retirement early thanks to our action, we must now ensure that the pensions market is working for them, so that they get the best returns on their savings and ultimately have the comfortable and secure retirement for which they were planning.

We have heard many contributions this evening. I will briefly mention the hon. Member for Tamworth (Sarah Edwards) and my right hon. Friend the Member for North West Hampshire (Kit Malthouse), both of whom gave us lengthy and very detailed speeches presenting both sides of the argument. [Interruption.] They were very enjoyable speeches—that was not a criticism, just an observation of the way things have gone this evening. Both the hon. Member and my right hon. Friend clearly showed the expertise that they garnered earlier on in their careers and expressed some legitimate concerns, particularly about the consensus that there has perhaps been in the Chamber this evening. Some points have been made showing that that consensus is not entirely guaranteed, certainly among Conservative Members. We support the principles behind the Bill—indeed, much of what we have heard builds on the work that the Conservatives were doing while we were in government. We want to ensure that poorly performing pension schemes are challenged, excessive administration costs are removed, and savers receive the best returns on their investments. Ultimately, that is how we will ensure more people have a comfortable retirement.

However, we have concerns about some specific measures in the Bill, which we will scrutinise further as it progresses. In particular, we have significant concerns about the reserve powers that allow the Government to set percentage targets for asset allocation in core defaults offered by defined-contribution providers. In other words, a future Government could tell pension schemes where they must invest their funds, regardless of whether it delivers good returns for savers. This potentially conflicts with their fiduciary duty to act in the best interests of their members. While I know the Minister will stress that the Government do not intend to use those reserve powers, that neither addresses concerns about what a different future Government could do nor explains why those powers are being brought in. It could be asked why the reserve powers are being created at all.

We want to see more investment in the UK market. While this country is one of the largest pension markets in the world, only around 20% of DC assets are invested in the UK. However, the solution should be to make domestic investment more attractive—to create opportunities that deliver better returns for savers—not simply to mandate investment in assets that deliver lower returns. During our last term in office, we worked with the industry to introduce the Mansion House reforms as a voluntary agreement to boost investment in the UK, but this Bill goes further—it could mandate such investment against the wishes of the industry. Similarly, the local government pension scheme will have a new duty to invest in the local economy. While that is understandable at face value, it raises concerns about returns on investments if there are not suitable local opportunities.

We also have questions about some of the Government’s assumptions, and would like to understand more about how they were reached and the evidence used. For example, why is the minimum value for megafunds just £25 billion? Why is having fewer and larger pension providers better? We recognise the benefits of economies of scale, but what about competition and innovation? It has also been raised by the industry that a significant number of details are unknown, as they will come later in the form of regulations. Can the Minister set out some more details on when the various sets of regulations will be published, and whether that will be before the Bill has passed through Parliament?

Finally, the Bill fails to cover a number of areas, and we would like to understand why. Concerns about pension adequacy have been touched on this evening and whether people are saving enough to have the security and dignity in retirement they deserve. Auto-enrolment was a good start, but it will not be the only solution. Indeed, lots of people are still not eligible. When we passed the Pensions (Extension of Automatic Enrolment) Act 2023, the then Conservative Government confirmed their intention to reduce the lower age limit to 18, as has been mentioned this evening. As yet, the current Labour Government have not done so. Auto-enrolment does not apply to self-employed people, despite just 16% of self-employed people actively saving into a workplace or personal pension. The Bill does not look at whether people are saving enough and early enough, and I would be grateful if the Minister could set out whether that is deliberate and whether further action will be taken.

I briefly draw the House’s attention to my declaration in the Register of Members’ Financial Interests as a serving councillor, but I hasten to add that unfortunately I am not a member of the local government pension scheme. Sadly, I was elected after that provision was scrapped, but an entire chapter is given over to the local government pension scheme in this Bill. Indeed, it is a key element, enabling local authorities to use pension schemes to invest in their local economy. However, as with much of the legislation being taken through Parliament at the moment, the who, what and when remain unanswered. Without the English devolution Bill before us, for example, we are not entirely clear on what form local government will take, nor entirely clear on how compatible this Bill is with that forthcoming local government legislation.

We are in effect being asked to legislate on a moveable feast. Indeed, there is likely to be a considerable transition timetable for local government changes, which all raises questions about how the local government reorganisation transition fits in with the plans in the Bill. Following on from the comments of the hon. Member for Truro and Falmouth (Jayne Kirkham), how will asset pools work under local government reorganisation? Who gets the potential investment benefits or spending power, and where does all that investment take place?

The Bill also fails to mention any reforms to the local government pension scheme, which reached a record surplus of £45 billion in June 2024. One reason for that might be that it is being used to offset Government debt under the Chancellor’s current fiscal rule, which uses public sector net financial liabilities to measure that debt. That is a huge amount of money in local government terms, and it is not going towards local services, business support or regional projects. Can the Minister confirm whether the Government intend to reform the local government pension scheme beyond the measures outlined in the Bill? Finally on the local government pension scheme, I look forward to seeing more detail as to how newly created asset pools will work in practice with the local government pension scheme.

Local government treasury management over recent years has seen local authorities taking advantage of the investment opportunities available to them to acquire properties and the like, but often some distance from their local authority. That is something to tease out in Committee, but when the Government state that they wish local authorities to have finance available to invest locally to bring economic growth, what does “local” look like?

Finally, can the Minister confirm that fiduciary rules regarding investments and how they are assessed will prevail going forward? Overall, we will support a Bill that reduces administration costs, removes complexity for savers and maximises value for members, ultimately helping people who took the right action to save for their retirement to live in comfort and dignity. While this Bill makes the start, there is more to do to get it right, and we look forward to working with the Government to achieve that. There is plenty of food for thought for amendments to take us forward.

[Madam Deputy Speaker (Caroline Nokes)]

I call the shadow Minister.

Women’s State Pension Age: Financial Redress

Caroline Nokes Excerpts

Thursday 3rd July 2025 Commons Chamber

[Jim Shannon (Strangford) (DUP)]

rose—

[Madam Deputy Speaker (Caroline Nokes)]

Order. Before Mr Shannon intervenes, may I respectfully ask the hon. Lady to consider truncating her speech a little, as a number of colleagues will want to speak this afternoon?

[Jim Shannon]

There are 77,000 WASPI women in Northern Ireland, 7,000 of them in Strangford. Does the hon. Lady appreciate their palpable anger about how they have been mistreated and about the injustice that they wish to see addressed? On behalf of those 7,000 constituents of mine, I seek the same thing as the hon. Lady and all of us in this Chamber today.

--- Later in debate ---

[Sir Julian Lewis]

Yes. In a way, the Government have fallen between two stools. The report, as we have heard, anticipated that the Government would be reluctant to the right the wrong done to so many people at once, but nevertheless the Parliamentary and Health Service Ombudsman felt that justice required compensation to be paid. It knew that there would be this Government resistance, so it must have meant a lot to the ombudsman to still go down this highly unusual route of trying to present its report directly to Parliament, because it felt it would not get far by dealing with the Government directly.

One might have expected the Government to offer a scheme that fell some way short of the ombudsman’s recommendation, but their outright rejection of any restitution at all is rather insulting to the women whose complaint was upheld by the ombudsman. As we have heard, despite the DWP claiming to accept the findings, and even apologising for its maladministration, it is not offering a penny in restitution, and is relying in its response on a deeply unconvincing polling exercise that supposedly found that nine out of 10 of the affected women knew in advance that their state pension age was going to change. If that was the case, why did so many of them carry on as if nothing was going to change at all? A few moments ago, the hon. Member for Falkirk (Euan Stainbank) asked about the nature of the sampling that was done; only some 200 women born in the 1950s were included in the sample of nearly 2,000 people surveyed, which led to that misleading result.

I know the Minister has a great deal of expertise and a strong track record on issues of this sort from his former career, before he came to this House. I therefore appeal to him to at least reach out the hand of negotiation and discussion; to accept the offer that reasonable people are making to the Government; and to sit down and talk to them, and not to let the whole thing go through the courts, which would lead to an adversarial deepening of hostility and, inevitably, a less desirable outcome for everyone concerned.

[Madam Deputy Speaker (Caroline Nokes)]

With an immediate four-minute time limit, I call Brian Leishman.

--- Later in debate ---

[Jim Shannon (Strangford) (DUP)]

It is a real pleasure to speak in this debate. First, I thank the hon. Member for Salford (Rebecca Long Bailey) for setting the scene so incredibly well and all the hon. and right hon. Members who have contributed fantastically, putting across the demands of their constituents.

This is not a new issue, and we know that. I do not think I have missed a WASPI debate. Indeed, I do not think the right hon. Member for South Holland and The Deepings (Sir John Hayes) has missed one either in the time I have been here. This week in this House has given me hope that perhaps the Government can acknowledge when we are moving in the wrong direction. The Government need to correct the wrong steps taken and follow through on the recommendations in the ombudsman’s report.

Northern Ireland has some 77,000 WASPI women, of whom 7,000 are my constituents. I do not know all 7,000 personally—I have not done that roll-call—but those who have come to me have told me their stories. In many cases, they are ladies who have cleaned floors or cleaned offices or been classroom assistants or teachers. Age catches up with us all, and it catches up with me, too. It catches up with them, and their knees are not as strong as they used to be. They planned their pensions in accordance with the timescale, and then it was taken away from them. That is the concern I have. They had planned for their life, and then they were deprived of that.

The report rightly found that some WASPI women were not informed about the changes to their pensions and had made long-term financial plans based on the assumption that they would receive their state pension at 60. All their financial planning was in place, and then it was just taken away. That meant that when the WASPI women lost their pensions, they lost all sources of income and met unexpected financial insecurity. The insufficient information was not only negligent, but deeply unjust, and the Government have acknowledged that to be the case, so there is a precedent. The hon. Member for Lewes (James MacCleary) was right to say that the process was backed away from.

Women who spent decades raising families, paying taxes and contributing to the economy were left without recognition for their hard work. Many WASPI women were forced back into the workforce, often with disabilities and often into low-paying jobs, or had no choice but to apply for benefits. Those women should never have had to do that after a lifetime contributing to the system.

A number of these women—I call them the silent generation—still face significant outstanding debts and loans that they will struggle to pay off for the rest of their lives due to the inability to manage their income appropriately. When they realised that they could not access their pensions, their ability to go back to full-time hours was not simple, and the emotional toll has been significant, too. Many WASPI women now experience stress and depression brought about by financial uncertainty. It is only fair that the hard and consistent work done by these ladies is financially recognised.

I say this with respect to the Minister, but one of the first steps that this Government took was to sort out the back pay of union workers. I am not saying they should not have done that, but if there is to be fairness in this system, I cannot for the life of me understand how they can do that in one breath, and then in the next apologise to the WASPI women but not do right by them.

The silent generation are determined to be silent no longer. I applaud them for going against the grain, as we often say at home, by continuing to complain. I applaud them for continuing to speak, when many of them have been told to be quiet and give it up. I applaud them for continuing to hold Governments—this one and the last one—to account. I applaud them for standing beside the weary and the worn, and for demanding compensation for all affected.

Apologising is not enough. As the hon. Member for Aberdeenshire North and Moray East (Seamus Logan) said, it is not about words any more. It is about action, and now is the time.

[Madam Deputy Speaker (Caroline Nokes)]

I refuse to believe that age is catching up with the hon. Gentleman. I call the Liberal Democrat spokesperson.

[Daisy Cooper (St Albans) (LD)]

I, too, congratulate the hon. Member for Salford (Rebecca Long Bailey) on securing the debate, on campaigning on this issue, and on making sure that this debate came to the main Chamber. I thank all hon. Members for their contributions this afternoon. As well as hearing the very strong and powerful case around this particular issue, we have heard personal examples. Whether it is Gill from Tiverton, Ann from Newcastle, Helen from Seaford or Paula from Dewsbury, we have heard that many women rightly feel a sense of raw injustice, and the Government must act.

I have met WASPI women many times in Parliament, but I have also met them in my constituency. A couple of years before I was elected, I met a group of 30 WASPI women. I regret that I cannot recall the name of the woman whose case I remember, but her circumstances stuck with me. She was quietly spoken, and I could tell that she had real rage and fury inside her, but she was not prepared to show it. She just said, “I’ve spent my entire life working. I’ve raised a family. I’ve watched the pennies, and I was proud to stand on my own two feet. But at the end of my working life, I felt robbed of my money and robbed of my dignity. Even though I know this situation is not of my making and not my fault, I feel a tremendous sense of shame.”

That really stuck with me. Some 3.8 million women are affected by this issue, and many of them feel a sense of shame. They should not, but they do. It is really frustrating that the Government, notwithstanding the terrible inheritance that they received, have chosen to do nothing, and there are two problems facing them. The first is that an obvious injustice has been left unaddressed. The second is that, as so many Members from across the House have said, it sets a very dangerous precedent. For some women, an offer of an apology or a payment might be symbolic, but it is far more than that for many of them. It is about survival, and it would help them to get out of the struggle that they are now in.

On behalf of my party, I urge the Government please to reflect after this debate, and to go back to the drawing board and think about what can be done. At the very least, they should think of something to help those women who are struggling the most. Doing nothing is really not an option. If the rebellion earlier this week was for any reason at all, it was to send a message to this Government that their own party, this House and the British public want a Government who will stand up for the underdog—those who are hard done by in life, by the Government and by circumstances out of their control. I hope the Government listen today and act, because to govern is to choose. The Government must know that it is not too late to make a different choice.

[Madam Deputy Speaker]

I call the shadow Minister.

Universal Credit and Personal Independence Payment Bill

Caroline Nokes Excerpts

2nd reading
Tuesday 1st July 2025 Commons Chamber

[Several hon. Members rose—]

[Madam Deputy Speaker (Caroline Nokes)]

Order. I will reduce the time limit to five minutes after the next speaker, but I have no plans to reduce it further. Members will be able to see just how many are standing to speak and will know that this debate is scheduled to finish at 7 pm. That will mean many Members—35—will be disappointed.

[Richard Burgon (Leeds East) (Lab)]

I wish that we were not here today. We do not need to be here today. There is nothing special or magical about this Tuesday—nothing at all. The deadline we have been given is to solve a political problem. That is why so many of us on the Labour Benches have been pleading with the Government to pull the Bill, go back to the drawing board and work in partnership with disabled people and others, including with the Timms review, to ensure that we get a welfare system that works for disabled people and others. There is no need to ram the Bill through other than to save political face. There is no need to ram it through at Third Reading next Wednesday in Committee of the whole House so that disabled people cannot give evidence from their experiences in Bill Committee. There is no need to do that at all. We should be solving this problem, not solving a political problem.

We are being asked to vote on the principles of the Bill, and all hon. Friends should be clear about what those are. They are on the face of the Bill. It says,

“to restrict eligibility for the personal independence payment.”

That is the purpose of the Bill. My colleagues and I did not come into Labour politics to restrict eligibility for personal independence payments. When I think about what we are being asked to vote for tonight, I think not just of my colleagues here, but of the disabled people who come to my constituency advice surgeries. I think of the disabled people who had hope in their hearts a year ago when a Labour Government were elected after 14 years.

Let’s be clear: this was not in our manifesto. The Labour party as a whole has not approved this, and the Bill has been rushed through. We need to be clear that if this were a free vote, it would be hard to find many Labour MPs at all voting for it. As my hon. Friend the Member for York Central (Rachael Maskell) said, this is a matter of conscience, and we need to be clear about what we are comparing here. When we decide how to vote tonight, we are not comparing the Bill as the Government intended with the Bill as is promised; we are comparing the situation of disabled people across the country as it is now with the situation that will come to pass if the Bill is passed.

This Bill, which was brought—whatever the narrative—to save billions of pounds, with these concessions still cuts billions of pounds from disability support. No Government and no Labour Government should seek to balance the books on the backs of disabled people. That is not what any of us in the Labour family, left, centre or right of the party, came into politics to do, and that is why so many people are uneasy about this.

My hon. Friend the Member for South Shields (Emma Lewell) spoke clearly from her experience. She regretted not voting against the Conservatives’ welfare Bill back in 2015. I urge all colleagues to listen carefully to what she said because the truth is this matter does not end when the voting Lobbies close tonight; this matter will come back to haunt Labour MPs in their constituency surgeries Friday after Friday up to and including the day of the next general election. People will ask, “Why on earth did you vote for these cuts?” or “Why on earth did you sit on your hands?”

It is notable that 138 disabled people’s organisations are pleading with Labour MPs to vote for the reasoned amendment tabled by my hon. Friend the Member for York Central and vote against this Bill. I know the Whips and those on the Front Bench can make compelling arguments, but for me, the real compelling argument has been made outside this Chamber by those 138 disabled people’s organisations. It was very telling that, when asked yesterday by my hon. Friend the Member for Liverpool West Derby (Ian Byrne) to name one disabled persons’ organisation that supports this disability benefit cuts Bill, the Secretary of State could not name one, because there is not one.

I honestly believe that for any Labour MP who votes for this Bill tonight or sits on their hands, that vote will hang like an albatross around their necks. I understand that some colleagues will feel they have to vote for disability benefit cuts out of party loyalty, but there are other types of loyalty in addition to that: loyalty to our consciences; loyalty to our party’s values; loyalty to our disabled constituents; loyalty to those who are really struggling and come to see their MP—people like me, on about £90,000 a year—and ask them for help. I do not want to be in my constituency advice surgery saying to those people, “You know how you’ve got a problem and you’re in a really difficult situation? Well, that’s because of the way I voted.”

I urge MPs to have the democratic dignity that comes today by voting with their conscience and voting to give disabled people outside this place what they have been denied for too long: dignity, respect, a voice in this House and a vote in the Lobby—

[Madam Deputy Speaker (Caroline Nokes)]

Order.

--- Later in debate ---

[Johanna Baxter (Paisley and Renfrewshire South) (Lab)]

My hon. Friend talks eloquently about the legacy left by the Tory Government. Does he agree that we need two Labour Governments working together in Scotland because the situation—[Interruption.] Those on the Opposition Benches may not want to hear it, but one in six Scots is languishing on an NHS waiting list as a result of the decisions of the Scottish Government—

[Madam Deputy Speaker (Caroline Nokes)]

Order.

[Matthew Patrick]

My hon. Friend is totally right, and the SNP record is worse. One in eight young people are not in employment, education or training here, but in Scotland the figure is one in six, and the SNP should be ashamed of its record for the Scottish people.

The Bill will introduce a right to try, so that people who receive support but have a job offer know they can take that opportunity with both hands and with no fear, because if for whatever reason it does not work out, the same support will be there for them. This removes an important barrier for many. We are also increasing the standard rate of universal credit and committing £1 billion in pathways to work funding. We aim to restore dignity to a system that has become a burden to those it should serve. This is a moment to rebuild trust in the safety net, to protect those who cannot work and empower those who can, and to restore dignity to everyone.

--- Later in debate ---

[Deirdre Costigan]

Will the hon. Member give way?

[Madam Deputy Speaker (Caroline Nokes)]

Order. I just make the point to the hon. Member that the hon. Gentleman is clearly not going to give way, which is in his gift.

[Ayoub Khan]

I say to the Ministers and hon. Members who claim that these changes are needed to preserve the welfare state that the welfare state was built on the idea that everyone would receive state support for things that were out of their control, no matter what. Passing this Bill will not preserve the welfare state but dismantle it, and I urge every Member of this House to reject it. We can and must do better than this. The people we represent deserve far better.

--- Later in debate ---

[Several hon. Members rose—]

[Madam Deputy Speaker (Caroline Nokes)]

I call Andrew Pakes.

[Andrew Pakes (Peterborough) (Lab)]

On a long, hot, sweaty day like this, one of my hearing aids has collapsed in the middle of this session, so I am only half hearing you, Madam Deputy Speaker—you did call me, didn’t you?

[Madam Deputy Speaker]

indicated assent.

[Andrew Pakes]

Thank you—you have saved me the embarrassment.

It is a great privilege to speak in this debate alongside so many passionate advocates who want to get this reform right. I think all of us on the Government Benches, whatever our differences of opinion on a point of policy, came into this House to make a difference and fix the welfare system, to liberate and create opportunities for people. I thank the Secretary of State for her statement yesterday and welcome news of the PIP assessment review, which moves us forward. It is vital that we engage those most affected by a failed welfare state in designing a successful one.

We have put off change for too long. That is particularly true when it comes to young people. If politics is about choices, condemning nearly a million young people to the scrapheap of unemployment was the choice of the Conservative party. I want to focus my contribution on how these changes can affect young people and their life chances.

Full employment and good-quality jobs have been a central part of Labour’s most successful Governments. That is why fixing Britain’s broken system of social security must be a priority for this Labour Government. There is no dignity in denying young people the opportunity to learn, earn or make a better life for themselves. As we approach the 80th anniversary of the 1945 Labour landslide, we must remember previous Governments who have dealt with such big challenges. Work was essential to that great 1945 Labour Government. William Beveridge’s landmark report in 1942 laid the foundation for Labour’s post-war welfare state, with an NHS, free education for all and full employment.

The vision of Labour leaders such as Attlee, Morrison and Bevin was that every citizen would live a life free from want, squalor, disease or poverty, with meaningful help when times were tough. In return, every citizen was expected to play a full part in the social and economic life of the nation. Looking at the high number of people not in education, employment or training—NEETs, that terrible phrase—in my constituency, I see an economy that is still letting people down, a mental health system that is letting young people down and an NHS system that is trapping too many young people on a life of benefits.

When the Minister winds up the debate, can he confirm that we will deliver the employment support that young people need and simplify the way that benefits and jobcentres work, so that young people get the support they deserve? Will the Secretary of State work with the Secretary of State for Health and Social Care to fix our broken mental health system, so that young people have a hand up rather than being pushed down? Our values should be about compassion, and our social security system should be about dignity for those who are unable to work or need support. That is why I welcome the protections that have been announced for people already on PIP.

There has been a common theme in the debate. Many Members have raised concerns not with the fact that the Timms review will happen—it will begin to embed co-production, as the Secretary of State and many others in this House have said—but, I think legitimately, about its timing.

--- Later in debate ---

[Andy McDonald (Middlesbrough and Thornaby East) (Lab)]

On a point of order, Madam Deputy Speaker. I would be grateful for your clarification. We have just heard that a pivotal part of the Bill, clause 5, will not be effective, so I ask this: what are we supposed to be voting on tonight? Is it the Bill as drawn, or another Bill? I am confused, and I think Members in the Chamber will need that clarification.

[Madam Deputy Speaker (Caroline Nokes)]

The hon. Member will be aware that that is not a matter for the Chair, and the vote will be on the Bill as it stands. We have had a clear undertaking from the Dispatch Box as to what will happen in Committee.

[Andrew Pakes]

As a member of a party that often debates clause IV, I welcome today’s news about clause 5, which I think addresses many of the concerns that hon. Members across the House, particularly on the Government Benches, have raised.

There is an urgency to moving forward with the Bill and with change. Today’s system is broken. The legacy of the previous Government is shocking. Some 2.8 million people are outside the labour market due to long-term sickness. That is the same as the populations of Birmingham, Leeds, Sheffield and Liverpool combined. One in eight young people are outside education, employment or training. The UK is the only G7 economy where sickness rates are higher than before covid, and as we have heard, health and disability-related benefits will cost around £100 billion over the next four years. That has a massive impact on our national resources. Economic inactivity not only holds back growth and makes us all poorer, but it blights the lives of those without work. That is why Labour Members believe that tackling worklessness is not just an economic case but a moral crusade.

In conclusion, I want to see real support for people to get skills, opportunities and jobs. I want every 18 to 21-year-old to be offered a life off benefits through an apprenticeship or training. I want real support for people with poor mental health so that they can access the care they want. We need Labour’s Employment Rights Bill to be fully implemented to change the culture of work, so that employers work with disabled people to create the opportunities we need. Most of all, we need a system of social security that is there for everyone with a genuine need, so that no one falls into poverty because they lose their job and everyone who can work is given a path back into employment.

Welfare Reform

Caroline Nokes Excerpts

Monday 30th June 2025 Commons Chamber

[Liz Kendall]

I simply say to the right hon. Gentleman that there are many differences in the benefits system already—people are on different rates and have different rules depending on the time they came into the system. That has always been a part of the social security system, including under previous Labour Governments. The Timms review will look at the different descriptors and the points that are delivered to them, alongside much wider changes. PIP came in more than 10 years ago, and there have been huge changes in the nature of disability, the world of work and society. We have to ensure that this vital benefit stays in future, and that is what the Timms review seeks to achieve.

[Madam Deputy Speaker (Caroline Nokes)]

I think it would be helpful to let Members know that I plan to allow this statement to continue until 5.15 pm. It would therefore be helpful if questions were short.

[Alex McIntyre (Gloucester) (Lab)]

Over recent months, I have consulted with constituents who have lived experience of disability and the welfare system and their representatives. I know that they will welcome the Secretary of State’s statement that protections for existing claimants will be protected, but one of the most heartbreaking stories I heard in those consultations was about a young constituent who applied for hundreds of jobs and attended dozens of interviews and simply could not find a job. Will the Secretary of State meet me to discuss what more we can do not just to support disabled people in my constituency, but to encourage employers to take on some of the talented, brilliant people living with disabilities in my constituency?

[Liz Kendall]

My hon. Friend raises a really important issue, which is the world of work and the need to ensure that employers recruit and retain more people with long-term sickness or a disability. That is precisely why, in addition to the huge advances in our Employment Rights Bill, we have asked Sir Charlie Mayfield, the former boss of John Lewis, to look at what more we can do to support employers to recruit and retain disabled people. We are also overhauling our jobcentres so that they provide more personalised, tailored support. Indeed, we have set our jobcentres a new goal of reducing the disability employment gap, which I believe will also make a huge difference.

[Madam Deputy Speaker (Caroline Nokes)]

I call Cameron Thomas.

[Cameron Thomas (Tewkesbury) (LD)]

Welcome back, Madam Deputy Speaker. The Government’s recent compromise with their own MPs secures PIP for existing claimants, but not for those who come hereafter—a distinction born not of compassion, nor apparently of economics, but to secure the Government’s own political footing. If I am wrong, will the Secretary of State describe the moral foundation for this distinction between those who suffer today and those who will suffer in the future?

--- Later in debate ---

[Several hon. Members rose—]

[Madam Deputy Speaker (Caroline Nokes)]

Order. I encourage Members to keep their questions short, or they will not all get in.

[Harpreet Uppal (Huddersfield) (Lab)]

Having met disabled constituents over the last few months, I have no doubt that the initial proposals caused anxiety, so I do welcome the changes for existing claimants and the Timms review. However, can I urge the Secretary of State to look at the sequencing to make sure that the review happens before we assess new claimants? I have one final point about the assessors themselves. There is no doubt but that the involvement of private companies such as Capita and Maximus has caused problems, as has having assessors who do not understand health conditions. Can we make sure that we look at that properly?

--- Later in debate ---

[Several hon. Members rose—]

[Madam Deputy Speaker (Caroline Nokes)]

Order. For the final question, I call Sarah Coombes.

[Sarah Coombes (West Bromwich) (Lab)]

My borough, Sandwell, has one of the highest rates in the entire country of young people not in education, employment or training. This generation of young people have been let down by years and years of system failure by the Conservative party. As we go through this necessary piece of reform, we must do it carefully. Will the Secretary of State commit to working with the Department for Education and the Department for Business and Trade? For young people to get the jobs that will transform their life chances, they will need the right qualifications as well as needing the jobs to be available.

Public Authorities (Fraud, Error and Recovery) Bill

Caroline Nokes Excerpts

Report stage
Tuesday 29th April 2025 Commons Chamber

[Several hon. Members rose—]

[Madam Deputy Speaker (Caroline Nokes)]

Before I call the next speaker, may I make it clear that I will come to the Liberal Democrat spokesperson immediately afterwards?

[Gill German (Clwyd North) (Lab)]

I welcome the return of this Bill to the House. I was happy to speak on it on Second Reading, when I welcomed the Government’s crackdown on fraud, because every pound lost to fraudulent claims is a pound that could be spent on the vital public services on which my constituents in Clwyd North rely. It is extremely good to see the recognition of the issue, and the action taken in response to the £7.1 million of fraud and error payments in 2022-23 in Wales alone—that figure is up by £600,000 on the previous year.

The fine-tuning of this Bill is important, and that fine-tuning is done through the Government amendments, which speak to the correct application under devolution settlements, policy intent, the application and limitation of part 3, and the consequential amendments proposed to parent Acts. I was glad to be a member of the Public Bill Committee that considered the Bill in more detail, and I throw my weight behind the comments made about how the Bill Committee progressed, and how helpful that was to Committee members. The explanations and expansions by the Ministers served us well and have brought us to where we are today.

I spoke on Second Reading about the distinction between intentional fraud and accidental individual error, and I am pleased that Government amendments speak to reservations relating to that, and to proportionality. Crucial safeguards will be strengthened to ensure that no one is pushed into undue financial hardship because of debt recovery. Those safeguards include strict affordability checks on recovery payments, and checks on vulnerabilities.

[Gill German]

The Bill will protect vulnerabilities where we see them and it is very much a Bill of last resort. It is aimed at people who are not engaging with the DWP on fraud and error cases. Now that carers are aware of the problems that have occurred in the system, we hope that they engage, so I do not believe that the Bill will impact them in the way that the hon. Gentleman suggests. Indeed, the Bill will protect claimants by enabling early dialogue, which will stop errors sooner and prevent debt building up through genuine mistakes; I initially had a reservation on that point.

It is clearer than ever that the measures are powers of last resort for those who have refused to engage and are able to pay—it is important to emphasise that point. The measures put DWP powers in line with those that already exist for His Majesty’s Revenue and Customs and the Child Maintenance Service, and put the importance of the public money spent by those bodies on an equal footing.

The behaviour change that is expected to come as a wider benefit of the Bill is welcome. The Bill encourages debtors to negotiate a repayment plan ahead of using the measures of last resort. Importantly, as has been said, it deters organised fraudsters and those looking to become involved in fraud by ensuring that it is not framed as a victimless crime. It is anything but, because it robs us all of vital money for public services. We are not willing to shrug our shoulders at that, as the Conservative party did at the rising tide of fraud during the covid pandemic and beyond. We must all reinforce the narrative that benefit fraud is not a victimless crime, and our tackling it through the Bill is long overdue.

Throughout the passage of the Bill—in Committee and now on Report—I have been reassured that those who have genuine difficulty navigating the social security system have nothing to fear from the Bill. Indeed, it will raise awareness of the importance of early dialogue. However, I still have concerns about the complexity of the system and how it is administered, as I voiced at Second Reading, but that is for another day. As a member of the Work and Pensions Committee, I will continue to focus on that, as well as having regular dialogue on the subject with my constituents.

To conclude, I welcome the Bill and the fine tuning that has come about through Government amendments passed in Committee. I was pleased to serve on my first Public Bill Committee, and thank the Chairs, Ministers and all involved for its smooth running. I am happy to support the Government amendments put to the House today.

[Madam Deputy Speaker (Caroline Nokes)]

I call the spokesperson for the Liberal Democrat party.

[Steve Darling (Torbay) (LD)]

I start by assuring the hon. Member for South West Devon (Rebecca Smith) that my office has talked me out of mentioning the Waitrose cheesecake that was a hot topic throughout Committee. On a more serious note, I would like to explore the challenges in the Bill. As we have heard, fraud can only be a bad thing, as it robs the public purse, but we need to ensure that our approach is proportionate, and that is where the rub is for us, as Liberal Democrats.

First, I want to focus on the covid crisis. We all lived through that, and some of us were in hot seats. I was leader of Torbay council at the time, so it felt as if I was in the eye of the storm for some of those challenges. I am afraid to say that for many of us in this Chamber, it feels as if the Conservatives were asleep at the wheel, given the level of fraud that we saw taking place during the pandemic. The fact that £10 billion-worth of fraud occurred around personal protective equipment is shocking. Some £16 billion of fraud occurred around support for businesses. While it was extremely important that we supported businesses appropriately, the safeguards were extremely limited. One businessman in Torbay said to me that it was as if the Chancellor of the Exchequer had got handfuls of £50 notes, filled carrier bags across the town centre, and said to the criminal element, “Come and help yourselves.” The reality is that the money could and should have been put to good use. In my constituency, Torbay hospital is crying out for investment. We have a sewage scandal, and the Environment Agency could be supported in tackling that issue. We also have the cost of living crisis; we could support people in ensuring warmer homes. All that money could help with those things.

A colleague and good friend has already alluded to the carer’s allowance crisis, and the real challenge that it poses. More than 136,000 people—the population of the Torbay unitary authority area—are affected by it. There is some £250 million of cost on those people. We Liberal Democrats fear that the powers in the Bill could make things even tougher for those who have challenges to do with the carer’s allowance.

Members do not have to take it from me that the benefits system is broken; the Secretary of State for Work and Pensions, the Chancellor of the Exchequer and the Prime Minister have said that it is. If there is such agreement in Government that the benefits system is broken, why are we adding to this edifice? It is built on a foundation of sand, yet we are looking to pile more responsibilities on to it, without looking for the true, positive culture change in the DWP that we need.

Colleagues have alluded to the areas of debate around the Bill. I will touch on a few major concerns that we Liberal Democrats have. The opportunity that the Bill presents for Orwellian levels of mass surveillance of those who get means-tested benefits causes me grave concern.

--- Later in debate ---

[Richard Burgon (Leeds East) (Lab)]

I congratulate my hon. Friend on his eminently reasonable and common-sense approach to this debate and on amendment 11. Does it seem to him, as it seems to me, that this legislation takes place in a wider context? Along with the proposed tightening of eligibility for personal independence payment, it moves us towards a hostile environment for benefit claimants, particularly disabled benefit claimants. We will end up treating them as suspects automatically. Does he agree that it was right for us to oppose this measure when the Conservatives wanted to do it? I tabled an early-day motion, signed by nearly 50 MPs, to that effect. We have to oppose this measure now. The best way to resolve it is by the Government accepting his eminently reasonable—

[Madam Deputy Speaker (Caroline Nokes)]

Order. That was a very long intervention. Perhaps we would be better off going back to Neil Duncan-Jordan.

[Neil Duncan-Jordan]

I thank my hon. Friend for his intervention. I will cover the connection between this piece of legislation and the Green Paper shortly.

--- Later in debate ---

[Several hon. Members rose—]

[Madam Deputy Speaker (Caroline Nokes)]

Order. It would be helpful if Members tried to confine their speeches to five minutes or so, but I do not propose to introduce a formal time limit yet.

[Esther McVey (Tatton) (Con)]

I wish to speak in support of new clause 11, entitled “Publication of results of pilot schemes”. Make no mistake: this Bill allows for a massive expansion of state powers. It will permit mass financial surveillance of the public. It is a massive overreach by the state, so of course it requires close scrutiny. It requires the publication of those results, and then they must be analysed.

Let me put this in context. Before the covid years, fraud and error across the tax and benefit system were at an all-time low. Then, in 2020, after a state-imposed lockdown—another massive state intervention—unprecedented financial support was set up for millions of people, in a rush of panic, with the full support of Members on both sides of the House. I exclude myself from that, but very few Members opposed the arrangement, and it opened up all sorts of new vulnerabilities in the system.

This support was set up only because of a blanket stay-at-home mandate from the state. It was the state that opened up those fraud vulnerabilities, and it was the state that saw, as a result of those impositions, many millions more people claiming universal credit. Let me give the House the figures. In March 2020, 3 million people were receiving universal credit. By November that year 5.8 million were receiving it, and in January 2025 the number was 7.5 million. Just as the heavy-handed state intervention of lockdown left the public paying a very high price, I am concerned that the Bill, another heavy-handed state intervention, will also leave the public paying a very high price. As Big Brother Watch states, the Bill will introduce

“an unprecedented system of mass financial surveillance; create a second-tier justice system for people on the poverty line; undermine the presumption of innocence; result in serious mistakes risking the freedoms and funds of our country’s elderly, disabled and poor; and turn Britain’s once-fair welfare system into a digital surveillance system.”

I have said it before and I will say it again, lockdown was an experiment inflicted on the British people without their consent and that experiment failed. The Bill will be another such experiment on the British public.

--- Later in debate ---

[John McDonnell]

Following the right hon. Gentleman’s track record on issues like this—he has been proved right on virtually every occasion—I agree. In addition to the mass surveillance, the extent of the information that can be sought and interpreted from the Bill is extremely wide-ranging and open to challenge.

What has annoyed me is that we are now introducing legislation in advance of what we were promised by way of codes of conduct and operation. We have no idea how this will work out in practice without those codes. Members may recall that the codes set out detail on how the system would operate at every level, with the information seeking, investigatory powers and so on. We do not have those, but we are being told not to worry, because the other place will receive them—well, that is not our responsibility as MPs. Our responsibility is to deal with the matter here.

We also do not know how the “independent persons”, as they are described in the legislation, are to be appointed or how they are going to operate. The hon. Member for Brighton Pavilion (Siân Berry) raised the question of how their reports and recommendations will then be implemented. There is also the question of whom they will be accountable to and whether there is any accountability for those independent persons to this House.

Time and again, when we have introduced legislation like this in the past that has short-circuited the traditional protective constitutional and legal mechanisms, it has led to debacles and miscarriages. I warn Ministers that that is exactly what we are facing here. Reference has been made to issues with regard to the use of computers, models and algorithms. We seem to have learned nothing from where we have made those errors.

As I also raised on Second Reading, what is happening here is discriminatory. We are choosing a class of people—largely working-class people—who are claiming benefits, and we are targeting them. If there is a class of people we should be targeting who have a record of fraud and of claiming things that they should not, well, here we are. As the expenses scandal demonstrated, if there is one group of people we should be examining more closely, it is Members of Parliament.

I want to talk very briefly about the impact of these measures from a constituency point of view. As an MP for 28 years and a councillor for over 12 years—40 years in total—I have met lots of people who do not claim benefits to which they are entitled. They are often older people, but there are others as well. Why do they not claim? In my experience, it is because of the stigma attached to claiming benefits. With this Bill, we are adding a bit more stigma, which will act as a disincentive to those who genuinely qualify for benefits and should be coming forward. It is that terror of making an error, that fear of risking being penalised for claiming a benefit they may not be entitled to—or of being paid too much. There is a real fear among my constituents about such miscarriages.

Most of the constituents who come to our constituency surgeries have tried everything else by the time they get to us. They are the ones with the most chaotic lives. And they are the ones who get sanctioned time and again, not because of any deliberate act, but often because they have mental health issues, or because something in their life, prevents them from attending that interview, or from applying for enough jobs in time. What will happen to them? They will be dragged into this system again. At the moment, they come to us—this is largely the case in my constituency—because most of the advice agencies have been closed down thanks to the cuts that have taken place, and they come to us in desperation. This Bill will make people even more desperate. It will deter people who qualify for benefits from claiming, and it will cause real hardship and impose severe penalties on those who least deserve it. That is why I think this is a poor piece of legislation, and it will not be long before we are back here again to amend it, to restore some elements of civil liberties and protection for the poorest in our society.

[Madam Deputy Speaker (Caroline Nokes)]

I shall impose, with immediate effect, a four-minute time limit.

[John Milne (Horsham) (LD)]

When it comes to public money, everyone accepts the importance of preventing fraud; there is no dispute about that. The mere thought that our benefit system could be exploited loosens the cement holding our welfare system together. However, if we look back in history, there has been a track record of fraud recovery measures not delivering what was hoped. This measure will also probably never save the £1.5 billion that is expected of it, so I ask: will the alleged rewards of this legislation ever match the scale of the imposition on our civil liberties, and are we really going after the right targets?

We all want to catch deliberate and professional fraudsters, but they are precisely the people who are astute enough to change tactics, set up separate bank accounts, and avoid suspicion. Instead, it will be the innocent and the accidental claimants who fall into the trap. The implicit assumption is that we should trust in the DWP as a completely error-free organisation across the entirety of its massive operation. But the DWP does make mistakes. It makes mistakes all the time. And even when it knows that it has made a mistake, and it has been told so, it is very capable of making the same mistake all over again.

In my constituency of Horsham, Anthony and his husband were accused of providing misinformation to the DWP and were overpaid £10,000 as a result. Anthony protested without success. After a long fight the case went to appeal. The tribunal wasted no time deciding in his favour—it was an open and shut case. But then, earlier this year, Anthony and his husband were migrated over to universal credit. After confirming all details were correct, the DWP overpaid them again, and then sought to claw the money back over the following months. The DWP’s mistake, but Anthony pays the penalty.

The DWP has its rules, but real life does not run in straight lines. Real life is messy. How can we possibly rely on the DWP to mark its own homework when we know that there are just four fraud advisers per regional office to handle cases flagged by frontline staff?

Yes, there are some checks and balances within this legislation, but what is really needed is a profound cultural change within the DWP, and that is much harder to achieve. The common experience of people who have to deal with the DWP on a daily basis is that they feel that it is always looking to catch them out. Years and years of inflammatory rhetoric under a succession of Conservative Governments have convinced people to regard the DWP as their enemy, not their friend. If anything, the Bill digs that hole a little deeper.

What concerns me most about the Bill is its extreme overconfidence. It assumes that Government agencies always get things right and that individual citizens are to be automatically treated as objects of suspicion. In Committee, the Government were resistant to any amendments except their own, so I very much hope that they will reconsider today and accept the Liberal Democrat amendments.