---

Pensions Bill

We have not yet seen any of the details of the proposals, but we want to support the Bill, and we want it to be right. I hope that, in the spirit of consensus for which the Secretary of State argues, the problems can be resolved and the Bill can receive Royal Assent in a form that we can all applaud. That is certainly our objective. The Secretary of State has, of course, inherited a troubled pensions legacy for which he is in no way responsible, and I applaud him again for his work in sorting out some of the problems. The real culprit is sitting in No. 10 Downing street. The Secretary of State was not responsible for all the pressures on pension funds over the past 10 years, and indeed the Prime Minister was not responsible for all of them. Some developments, such as the fact that people are living longer, are outside the control of any politician or pension fund trustee. But—this is relevant to the point made by the hon. Member for Birmingham, Edgbaston (Ms Stuart)—there are two areas in which the Government have clearly had an impact on the fortunes of pension funds: taxation and regulation. In both those areas, the decisions made by the Prime Minister since 1997 have been the equivalent of a series of logs placed on the camel's back. No wonder the camel's back broke. The Bill represents the Government's second major attempt to sort out the mess that they have made of our pensions system. The last one, the stakeholder pension, proved to be a complete white elephant. The Bill consists of the final part of a set of reforms initiated after the Government called in Lord Turner to help them to find a way out of the mess. The House has already approved the changes to state pension arrangements. The establishment of new pension arrangements designed to persuade more people on lower incomes to put money aside for their retirement is clearly the right thing to do, so we support the establishment of personal accounts. However, the Government have built a long track record of grand announcements followed by failure to deliver, and these reforms are in danger of continuing that tradition. There are real issues in the detail of what the Government are establishing, and we—along with, I hope, Members in all parts of the House—will subject them to intense pressure so that we can put matters right as the Bill is debated in the coming weeks. Before I deal with the weaknesses, I want to make one thing clear to the Government. There is broad consensus about the direction of these reforms, but Ministers have used that consensus as a shield from serious debate, which is unacceptable and undermines the very concept of consensus. Anyone who challenges the Government over the detail is accused of undermining the consensus. That is true not just of debates in this House. People involved in the stakeholder briefings held by Ministers have told me that when they expressed concerns, they were warned about the risk of undermining the consensus. That is not good enough. Consensus has to be earned. If Ministers want the consensus to continue—I assume they do—they need to engage in constructive dialogue with, and listen to, everyone involved: maintaining the consensus is not just about insisting that everyone has to agree with Ministers. It is absolutely right and proper that Parliament and outside bodies debate these measures vigorously in the coming weeks. There are things about this Bill that are not right and more information needs to be published. Ministers need to respond constructively to suggestions and questions from both sides of this House. If they fail to do so, it is they and no one else who will be undermining the consensus. The Government could start by engaging in a proper and constructive debate about means-testing: everyone agrees that the problem has to be addressed. I have already quoted the National Association of Pension Funds' most recent document, which states that"““without addressing the means-testing issue and its interaction with automatic enrolment the Government could undermine the whole reform process.””" The Association of Independent Financial Advisers has a letter in today's Financial Times that says that"““it is unacceptable that people who conscientiously save for their future could receive no benefit from being prudent. Because of means-testing, up to one in five future pensioners could effectively be worse off than those who opt out of personal accounts and choose to rely on state benefits.””" Age Concern states:"““The interaction with means-tested benefits is not a reason to delay or reconsider the policy of auto-enrolment. However the Government should set up a review to look at the options and trade-offs.””" It is a matter of concern to all the organisations involved that, as yet, the Government are not engaging in constructive debate.