---

Pensions Bill

I thank the noble Baroness, Lady Hollis, for her comments and the Minister for his reply. He has confirmed that while the December 2006 White Paper said that when launched the national insurance limits would be picked up, the Government are not planning to do that. They are planning to start in 2006-07 an uprate by earnings. The Minister says, ““Well, payroll software can handle that””. This is a curious policy. The Government have just started on a process that is having a bit of a hiccup this year because they screwed up the 10p tax rate. The policy was to harmonise national insurance and income tax. Here we have a completely different set of rates overlaid on that, which will make it complicated for employees to understand the point at which they start paying tax, national insurance and pension contributions, so the cleanliness referred to by the noble Baroness, Lady Hollis, has been removed. The complexity is considerable for employees, and it is something that we want employees to relate to and understand. It is too easy to say that payroll software can pick up how it works for employers because this is going to micro-employers who have not in the past come into pension provision. They do not always have payroll software; it is not necessary if you have payroll of only three or four people. You can do it in the old-fashioned way with tables and so on. The Minister has told me that the Government are putting in a rather complicated scheme with automatic enrolment. It is at a level of complexity that I had not fully thought through until we started to go through this amendment. I said that it was a probing amendment and I shall withdraw it, but I want to reflect further on the kind of complexity that we are introducing and whether it is advisable. I certainly look forward to receiving the information that the Minister has promised to give to his noble friend Lady Hollis because I would like to share in that. For now, I beg leave to withdraw the amendment. Amendment, by leave, withdrawn.