---

Pensions Bill

I am not one to resist a challenge, especially from the noble Lord, Lord Oakeshott. My first reaction to this amendment is that it is starred; in other words, it was put down at the last moment before the Marshalled List was assembled. Although I have a complaint on the amendment, it is not for that reason. I can hardly object to starred amendments when my noble friend Lady Noakes and I have put down some ourselves, which we hope will be debated today. We will see how the day pans out with the Statements and anything else that may occur. I note too that the Minister has littered today’s Marshalled List with amendments over and above those on the first Marshalled List, although, admittedly, none of those appeared to be starred when I glanced through them this morning. My complaint is that this is a totally unnecessary paving amendment for Amendment No. 136. The noble Lord, Lord Oakeshott, might have said, although I do not think that he did, that the reason for this amendment is that Amendment No. 136 will come so late in the Bill that he would not be able to divide on it successfully at what may well be late at night. I do not know whether he intends to go to a vote now, although as a former Whip I am more than suspicious. The Government have said that they fully intend personal accounts to come into operation in 2012, which I assume means at the beginning of the financial year 2012-13. I should be grateful if the noble Lord could confirm that this is a correct interpretation of events to come. This Committee can be in no doubt that two things are inextricably entwined with personal accounts. The first is the freezing of the second state pension; the second is to uprate the state basic pension by earnings rather than the RPI. Last year, in our debates, the Minister said that the latter would be done during the next Parliament. But the noble Lord, Lord Oakeshott, is right. No date was set and, although he and I tried to firm this up, we failed for the very good reason that no one could know when in the next Parliament such a commitment would be affordable. I was eventually, and am now firmly, persuaded of this. Since last July when the 2007 Bill arrived on the statute book, the nation’s finances have gone from bad to worse. Not only have the Government had to bail out Northern Rock, we have also seen the fiasco of them seeking to remove the 10 per cent income tax band. They have had to increase the upper earnings limit of national insurance and have brought forward the freezing of the second state pension, which, I might remind the Committee, was supposed to help pay for the uprating of the basic state pension by earnings. Not only that, but in order to do anything extra—equipment for our troops in Afghanistan, more money for local authorities and housing associations’ social housing schemes or the National Health Service—the Government’s only recourse seems to be to borrow yet more money. Why do Labour Governments—there have been two while I have been in your Lordships' House—always finish their term in government with huge borrowings, which then take many years for a Conservative Government to get down again to a realistic level? That is exactly the case today, but we must wait for perhaps as long as two years for a general election before we can start to repair the damage that has been done to the British economy. I defy the Minister to repeat the words of the late Lord Callaghan, ““Crisis, what crisis?””. Having got that off my chest, it is a fact that no one in any party or none—even the noble Lord, Lord Oakeshott—knows when it will be possible to afford to uprate the basic state pension by earnings. Somehow, though, by hook or by crook, there is a commitment by this Government, in the rather unlikely event that they are still in power, to do it by the end of the next Parliament. I have to say to the noble Lord, Lord Oakeshott, that to put a date on it that may possibly be even in this Parliament is just not on. The noble Lord challenged me to give a commitment on behalf of my party that we would uprate by earnings. I have to remind him that in the last Conservative manifesto we did indeed give that commitment. I cannot say exactly when that will be—that is the whole point of my complaint about the noble Lord’s amendment—for the simple reason that it will be some time before we are allowed by the conventions to look at the full Treasury figures. At that point we will be able to make a decision and I am sure it will be announced then. For all these reasons, I cannot support this paving amendment or Amendment No. 136.