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Pensions Bill

That is an important point which we would all be more able to understand if we were given access to the Government's model. That would be a start to a more open approach to building a consensus. The hon. Gentleman is right. It is important to note that the 15 per cent. is not a ceiling for the number of people at risk of losing out if they save in a personal account, but a floor, because other people fall into what the PPI describe as medium-risk groups, such as low earners who are in their 40s or 50s in 2012 and who have not yet started saving. Those people could lose entitlement to pension credit, council tax benefit or housing benefit as a consequence of saving, depending on their circumstances. The Secretary of State implied that almost everybody would be better off saving, and the first thing that we must do is to acknowledge that, given the current structure of the benefit system and pension credit, some people—we can debate how many, and it would be nice to have some information from the Government on that—will find that the personal account is simply not suitable in its current proposed construction. Therefore, to argue that everybody, no matter what their personal circumstances, should save risks the sort of mis-selling scandal that the right hon. Member for Birkenhead predicted. The question is what can be done about that problem, and several ideas have been floated, such as increasing the trivial commutation limit. The PPI has suggested a disregard. Both ideas have been knocked down by the Secretary of State on the basis of what he calls affordability, but it is inconceivable, in circumstances in which the number of people of pension age rises significantly in the next 30 to 40 years, that the proportion of our national income that we spend on pensions should not also rise. The Secretary of State's remarks about affordability are based on the idea that spending on state pension will remain broadly constant as a share of GDP for the next 20 to 25 years, but the number of people claiming pensions will rise. That suggests that the cake is being divided in such a way that pensioners will receive ever smaller crumbs. That is not the way to provide a firm foundation so that people can save for themselves. That is why the Liberal Democrats propose a citizen's pension, so that the basic state pension raises people above the poverty line, whereas at the moment people have to rely on pension credit for that in most cases.