Pension Schemes Bill (First sitting)

Debate between Kirsty Blackman and John Milne

Committee stage
Tuesday 2nd September 2025 Public Bill Committees

[John Milne]

Q Do you think that the finance industry has a clear understanding of how to apply its fiduciary duty? Do you think the Bill makes that clearer or muddies the waters, or somewhere in between?

Patrick Coyne: I think that fiduciary duty is a powerful force for good. Across the Bill, this is about giving those trustees the tools for the job. I think there are a number of areas where that is true. Within the value for money framework, at the moment, it is very difficult for employers or schemes to effectively compare performance. As an anecdote, I was speaking to a provider recently. They were pitching for new business. They came in and pitched their investment data, and the employer said, “You’re the third provider today that has shown us they are the top-performing provider.” That cannot be right.

Then, when you are looking across the Bill towards the DB space, because of the funding reality that many schemes are facing at the moment, there is choice in end game options—so, “How do I enhance member outcomes at the same time as securing benefits?” Actually providing a statutory framework for super-funds as another option is a good first step, as is allowing the release of surplus, if it is in the members’ best interests to do so.

[Kirsty Blackman]

Q I have a question about the balance of decision making. Trustees are obviously required to steward and grow assets on behalf of scheme members. This Bill slightly changes the priorities in relation to value for money. There is potential for future mandation, in that it basically allows the Government, or the regulators, more say in what direction trustees are taking. In practice, it is relatively difficult for scheme members to influence decisions that trustees take. My reading of the Bill is that it does not increase scheme members’ power over the direction. For example, if they wanted to disinvest in something, or if they felt strongly about investing more in UK assets, they will not have any more power to do that. Am I correct in my reading of that? Do you feel that some scheme members feel that they should have more influence over what trustees do and the direction of travel?

Charlotte Clark: It is a good question. It is hard to get over the fact that the vast majority of people are very inert in the pension system. Of course, there are some who are not, specifically around ESG—environmental, social, and governance—investments, but most trustees take those things into account, and there has been clarification about how that aligns with things like the fiduciary duty. Obviously, within the contract-based scheme, there frequently are options, if somebody does not like something that is invested in within the default, to have their own investment strategy, if that is what they choose to do. Do I think this Bill changes that? I do not think so. I think what the Bill is essentially trying to do is use the power of scale and collectivism to get better returns and, really, a better service for most savers.

Pension Schemes Bill (Second sitting)

Debate between Kirsty Blackman and John Milne

Committee stage
Tuesday 2nd September 2025 Public Bill Committees

[Kirsty Blackman]

Q In relation to investments and some of the stuff that was not invested in historically, if we are talking about renewable projects and affordable housing—things that, historically, pension funds have maybe not invested in—you said that investing in these projects is a problem for smaller companies until they build up that level of scale. Are there other barriers? Are there legislative barriers, or other barriers—maybe finding schemes to invest in—that you or other companies could do with additional help in overcoming?

Ian Cornelius: Having a strong pipeline of investable assets is key. There is no doubt about that. Patrick touched on this earlier: one other inhibitor has been cost. It is actually quite expensive to invest in private assets. One of the things that NEST does successfully is to drive that cost down, but that is a barrier. The focus on cost rather than value in the past made it harder. The Bill shifts the focus towards value, which will be really helpful. There are a number of challenges that the bigger you are, the easier it is to work through. The Bill as a whole will therefore definitely be helpful, but collaboration with Government and across industry should help to unlock more of those attractive private market opportunities.

Patrick Heath-Lay: I have previously discussed this with the Minister. There is a role for Government to play here. It was even acknowledged within the Mansion House accord that this is for the benefit of savers, and there is a role for all of us to play in finding those efficient routes to deploy that investment through. The problem right now is not whether there is investment to come; there is. The Mansion House accord has created that. There is a wall of capital potentially available. The issue is connecting it in the right way with the investable opportunities—not only the planning and whatever is needed to create those investment opportunities in the first place, but the routes of access and the investment vehicles used. There are further conversations to be had about how we can do that as an industry. Efficient deployment is probably the biggest challenge for us as an asset owner in ensuring that we are sharing that benefit back with members.

[John Milne]

Q Auto-enrolment is a great success story. It has certainly got lots more people investing in a pension than would have done otherwise. However, the fact remains that large numbers of them are nowhere near on course to have a reasonable pension in retirement. Small pot consolidation helps, but we have to admit that it is going to be a modest contribution to solving that problem. Do you think we are missing a trick in the Bill? Is there something else that could or should be there to help—or is that a job for another day?

Ian Cornelius: That is where we welcome the Pensions Commission. It has been set up to actively look at adequacy: what is right, and are people saving enough? There is no doubt that many people are not saving enough and there are a lot of people who are still excluded from retirement savings. There is a big issue and challenge with the self-employed. There is a challenge for the industry and the Government to work on, but the Pensions Commission creates the right environment to do that. Auto-enrolment has been a big success, but it is only a job half done. Completing that job through the Pensions Commission is incumbent upon the Government and industry.

Universal Credit and Personal Independence Payment Bill

Debate between Kirsty Blackman and John Milne

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

[Kirsty Blackman]

The hon. Gentleman mentioned the NHS and waiting lists. Does he share my concerns about the severe conditions criteria and the requirements for the diagnosis to be made by an NHS professional, in the course of NHS duty, when people may not have access to that? There is also a requirement for the condition to be considered “lifelong” by NHS professionals or health professionals, who may be unwilling to say that schizophrenia or bipolar disease, for example, are “lifelong” because they do not want to tie people down to that diagnosis.

[John Milne]

Yes, I agree that that is an additional concern.

The implication has been made, both by this Government and the previous one, that much of the rise in claims is down to benefit chasing and people simply exaggerating their conditions. This is an assumption that needs serious interrogation because it looks to be substantially untrue. For all these reasons and more, the best course of action would be to pull the Bill now and to make a fresh start. Denying adequate support today will only shift the burden tomorrow on to social care, the emergency services and our already overstretched NHS. We have been warned by the UN not once, but three times, that our welfare system is failing disabled people. Amendment 36 is a chance to show that we are listening.