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Pensions Bill

moved Amendment No. 89B: 89B: After Clause 29, insert the following new Clause— ““Report on auto-enrolment The Secretary of State must publish and lay before both Houses of Parliament a report annually on the impact of auto-enrolment on— (a) the take-up of; (b) persistency in; and (c) contributions to qualifying pension schemes.”” The noble Lord said: As with my previous amendment, this one also addresses another of the major issues that will decide the final success of the policy behind the Bill. Indeed, it would seem to address the most important one of all. As with means-testing, the issues of take-up and persistency are obviously at the forefront of the minds of stakeholders and Parliament. They have been raised many times by several of the employer and business organisations and have already cropped up in several of our debates, particularly when we have discussed the potential administrative costs and burdens that auto-enrolment in qualifying schemes will impose on employers. The figures from the multitude of reports have been quite varied. Naturally, the Government are sticking by the most optimistic result—that of little or no levelling down and a large upswing in the size of pension saving from the target population of low to medium earners. Unfortunately, this rosy view is not shared by everyone, and the possibility that the qualifying test will drive many employers into personal accounts must be considered and, if possible, protected against. My noble friend Lady Noakes referred to that last week in the debate on Amendment No. 60A. In response, I noted that the Minister said: "““What matters is that the amount that goes into the scheme at least equals what would go into the scheme if the 8 per cent of the band on the definition of earnings””—" that is, basic earnings— "““that is adopted were applied. We are not asking for that to be adopted in every scheme, simply that the contribution that goes into the scheme under the existing scheme’s rules produces at least that outcome””.—[Official Report, 23/6/08; col. 1300.]" I understand that but stakeholders still believe that the qualifying test will impose a burden on employers and, in many cases, will lead to their current schemes needing quite serious changes in order to qualify for auto-enrolment. To put it another way, it will not matter whether an employer’s scheme is calculated by reference to basic or gross pay as long as the total money going into the pension scheme is at least as much as it would be under the new personal account arrangements, which of course is 8 per cent. If stakeholders have misunderstood the import of the Minister’s remark, the size of this burden rests largely on details that the Minister cannot yet tell us about. My amendment therefore does not seek to amend these later crucial decisions but, instead, to keep the issue alive and to ensure that research and the education of stakeholders, which I believe is vital, continue so as properly to inform and communicate those decisions. I beg to move.