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Postal Services Bill [HL]

The noble Lord, Lord Clarke, raises some important points. The Royal Mail pension plan contains a variety of pension entitlements. For a start, there is the basic defined payment scheme which closed to new members last April, and the defined contribution scheme which replaced it. I think I understand that the Government intend to take over only the liabilities relating to the defined payment scheme, which is sensible, since the defined contribution scheme is by definition fully funded. However, I should be grateful if the Secretary of State could confirm that. However, there are more complications than just the direct contribution scheme. The noble Lord, Lord Clarke, has raised the question of what will happen to additional voluntary contributions. Clarification on these and any other top-up options that exist within the Royal Mail pension plan would be very helpful. The Government have indicated their intention, with this Bill, to take over many billions of pounds of liabilities. It would be extremely convenient for their balance sheet if they were able to take over more assets now in exchange for more liabilities in the future. However convenient for the Government stretching the taxpayer’s rescue to include all sorts of complications might be, it will be bad news for the taxpayer if anything more than the most pared-down liabilities are taken on. Absorbing fully funded liabilities from the Royal Mail pension plan will not help the pensioners and should not be allowed to happen.