---

Pensions Bill

I support the amendments, although we will need to ask some technical questions. I have two simple points to add. I concur with the comments of the noble Baroness, Lady Noakes: there is not enough urgency about the extent of the problem. The noble Baroness, Lady Hollis, says that this might encourage more DB schemes to level down, but a great amount of DB erosion is occurring at the moment. Evidence was produced earlier in the Committee stage which included the PricewaterhouseCoopers survey Does the Exodus Signify Genesis?. The Minister is right that it is a small sample of big companies. However, it shows not only that the schemes are being closed to new members, but that accrual rates are being dramatically affected. The Office for National Statistics survey published on 2 July 2008 confirmed that erosion. The starkest statistic in that report was that, in the three years since 2004, mostly because of defined benefit scheme closures, the number of active members of any private sector pension scheme has reduced by 25 per cent to 3.6 million members. That is happening in real time. It is happening now and in a very big way. Are the Government really sure that they are on top of it? Do they have a handle on the extent to which the erosion is happening in front of their eyes? The economic circumstances will not get better any time soon, and that will make the situation worse. The noble Baroness, Lady Noakes, is absolutely right that an enormous transfer of risk is taking place. This proposal is a halfway house and a statable and arguable case has been made. The noble Baroness, Lady Noakes, is right that we could talk about this for an awful long time, but at 6.55 pm on a Thursday I do not think that that would be the right thing to do. However, what harm can the proposal do? The noble Baroness, Lady Hollis, says that it might increase the temptation to tip some people in that direction. Apart from that—it is an important point which I have not heard before; I will have to think about it—what possible harm or difficulties could be caused by allowing this flexibility? And it is flexibility. I think most employers out there want to help as best they can. This device has been worked on by the ACA, as has been stated, for many years. They are serious people who know what they are doing. For the life of me, I cannot see what harm this would do. Statistics and fine debating points aside, are the Government really on top of the extent of the erosion? What harm could this set of amendments, properly drafted and put into the Bill, possibly do?