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Pensions Bill

My Lords, I listened carefully to that interesting speech. The noble Lord is always persuasive; indeed, at times he can sound quite seductive. None of us is in favour of dirigisme and poisoning the well, but I felt a little uncomfortable as I listened to some of the speech. I struggle in particular with the idea that a pension scheme with an employer contribution of less than 3 per cent can be a good-quality scheme. I simply do not feel in my heart that that is likely to be or can be right and I worry that the amendments water down the protections too far. ““Good quality”” would replace ““qualifying””, and I have difficulty knowing what that means. I listened with interest to the noble Lord’s reference to what I can only call the Equitable Life guarantee, because that is what it is—the one that brought that company on to the rocks. It would have a guaranteed annuity buyout but, if you think about it, the real ongoing cost of something like that is pretty high and will certainly in practice involve more than a 3 per cent employer contribution. So although the principles of simplicity and so on that he mentioned sounded quite attractive, I would require a lot of convincing that such schemes would also pass the test of having an employer contribution that was the equivalent of at least 3 per cent. The numbers simply do not add up.