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Occupational Pensions

We welcome the tone at least of the last part of the Secretary of State’s statement. We welcome in particular his announcement on costs. That was a great burden lifted from the shoulders of the claimants in this case and it reflects the public importance of it. We accept that important issues of principle are involved where an ombudsman’s findings are binding, and that they have implications across government that the Government will want to consider. However, my reading of the situation is that the clear view of the House is that the ombudsman is an Officer of Parliament and that her office is of no functional value if the Government can simply dismiss her findings when they do not like them. The Government have been criticised for their handling of the crisis by four separate bodies—the ombudsman, the Select Committee, the European Court of Justice and the High Court. From the tone of the Secretary of State’s final remarks, it seems that he might be getting the message at last. The facts of the case are that 125,000 people who paid into occupational pensions, many of them because they were required to do so by law when they joined, have, following the failure of the schemes, lost their pensions in whole or in part, and that the schemes were not as safe and secure as Governments of both political parties suggested they would be. Therefore, people approaching retirement and, in some cases, people who retired early have found that their retirement plans are in ruins. They have been left high and dry. The Secretary of State has said that the state cannot guarantee private pensions and he is right about that, but because of the creation of the Pension Protection Fund, the state does not have to. This situation cannot arise in future. It is a finite problem affecting a defined group of people. There is a palpable sense of an injustice being done. That sense is shared, I believe, on both sides of the House, in large sections of the media and in the country at large. The Government simply cannot ignore the view of the House of Commons and the sentiment of public opinion. I hope that I was correct in reading into the Secretary of State's final few paragraphs the indication that he is no longer intending to do that, because we as a society have to find a way forward to solve the problem. It has always been my view that the solution will not come through the courts. It has to be a political decision, based on cross-party consensus, with the Government taking a leadership role in building that consensus. Let me make it clear that no one is suggesting that the Government should simply write a blank cheque with taxpayers' money. There are many other possibilities to be explored. My right hon. Friend the Member for Witney (Mr. Cameron) invited the Prime Minister yesterday to set aside party politics and to seek to work together on the matter. I was pleased to hear what the Secretary of State said, and we are certainly ready to join him and all others in the House in trying to find a sustainable solution, based on the commitment of public money that has already been made through the financial assistance scheme, but also looking at whether better use may be made of the residual assets within the failed schemes, and whether we can make use of unclaimed assets within the financial sector to support a solution. Is the Secretary of State prepared to commit his Department to doing some serious analysis of the real net costs of different levels of support to this group of victims, taking into account benefit savings and taxation, so that our debate will be properly informed? The Government have now been told not once but four times that their response to the crisis is inadequate. There is a clear moral case for accepting a share of responsibility for the problem and for showing the leadership to broker a fair and affordable solution, but there is also a practical case. Pension saving is down and millions of people are making inadequate preparation for retirement. The Government rightly are determined to do something about that, but unless this issue is resolved, confidence in the pension system will not be restored. We could seek to make political capital by promising that the next Conservative Government will sort the mess out, and we will do so if we have to, but many of the victims cannot afford to wait another two or three years for a change of Government, so if the Secretary of State is telling us today that he is prepared to work with us and others to find a solution that is affordable and sustainable, I welcome that and I assure him that he will find us ready, willing and able to participate in those discussions.