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Postal Services Bill [HL]

We should differentiate between consultation and the concept of consent. The noble Lord, Lord Skelmersdale, picked up that particular sticking point in my noble friend’s amendment. The Government agree with the importance of consultation around these issues, and I will come on to that in a moment. With great respect, I disagree with my noble friend Lady Turner, who said that the power to amend the RMPP was unconstrained; it is not. Clause 18 states that it can be amended but only in connection with an order made under Clauses 16 or 17, and the provisions under Clause 18 are constrained by the protections in Clause 19. So it really is not right to say that the power is unconstrained. As we have heard, Amendments 61 and 78 both relate to the consultation the Government intend to undertake in implementing these pension proposals. Amendment 61 refers to the powers under Clause 18 that allow the Secretary of State to make the necessary amendments to RMPP in connection with the transfer of qualifying accrued rights to a new public service scheme and the creation of a new Post Office section. These powers are needed to ensure that the changes are fully effective and that the overarching requirement for the protection of scheme members against adverse treatment can be fully met. I am sure noble Lords will welcome that. For example, the creation of a new section for Post Office employees will require a number of changes to address the funding, investment and governance arrangements for the new section. Amendments to the rules are likely to be needed to confirm that Post Office Ltd rather than Royal Mail Group will exercise the powers and have the obligations of a sponsoring employer under that section, and that none of the Post Office section assets can be used to meet Royal Mail section liabilities and vice versa. To safeguard members still in service it will be necessary to amend the rules of the RMPP to ensure that the overall payments to members from the RMPP and the new scheme are at least as good after the transfer as they were prior to it. The amendment quite rightly seeks to probe the Government on how they intend to consult before making any such amendments. Clause 24 already provides that, before making any order to amend the RMPP, the Secretary of State must consult the trustees of the RMPP. That applies in the same way as it does to other orders under Part 2 of the Bill. I reassure the Committee that the Government have every intention of working very closely with the trustees, and indeed have already been in regular discussion with them on the detailed proposals provided for in the Bill. That will continue as the relevant secondary legislation is drafted, which we envisage will be starting soon. In addition to consultation, Amendment 61 would require the consent of the RMPP trustees before any amendments could be made to the plan. That would place a significant onus and responsibility on the individual trustees of the RMPP to make a decision in relation to an order proposed by the Secretary of State. We do not consider that to be appropriate; the ultimate decision on the detail of an order laid by the Government must rest with the appropriate Secretary of State. As I have said, it is absolutely right that in taking that decision the Secretary of State must consult the trustees. The second part of the amendment seeks to require the Secretary of State to consult directly, as he or she considers appropriate, members of the RMPP and representatives of its members. I should start by saying that the Government have already met representatives of current employees and pensioners to explain the proposals in the Bill, and intend to keep these organisations informed as the Bill progresses. Furthermore, as I have just explained, we are consulting the RMPP trustees. The trustee body currently includes five member-nominated and union-nominated representatives, and I am sure that the trustees already have mechanisms in place for communicating with scheme members. We continue to discuss with them and Royal Mail how they should best engage with current employees and other scheme members. It would not make sense for the Government to duplicate such activity. I turn to Amendment 78. The requirement in Clause 24 for consultation with the trustee of the RMPP is an important safeguard for members of the scheme. It reflects the trustee’s key role in ensuring that current members of the RMPP are protected, the Government’s need for assurance that the proposed measures will be fully effective and the need for close co-ordination between the new public service scheme and the RMPP in future, particularly in respect of active members of the RMPP. As I said, the Government are working closely with the trustee in relation to the development and implementation of the detailed proposals provided for in the Bill. That will continue as the relevant secondary legislation is drafted, which we envisage will be starting soon. We will welcome the detailed scrutiny and engagement of the trustees as part of that process. The Government will summarise the key points of that consultation and its outcome in the relevant Explanatory Memorandums that will accompany any statutory instruments, in line with the guidance in Statutory Instrument Practice. However, we do not support the effect of Amendment 78. The process of consultation must be effective and meaningful and the results should be properly understood and disseminated, but the Government would not wish the process of detailed consultation with the trustees on the draft regulations to be distorted by a rigid process around the preparation of formal proposals and responses, as this amendment effectively proposes. In our view, that would act as a constraint on both parties and would add little value to the process. Instead, for consultation to have the benefits that are intended, it will need to be detailed and continuous. There will need to be effective engagement and ongoing dialogue between the trustees and the Government, including at a technical or working level. That is certainly our expectation, and we believe that it also reflects the expectations of the trustees. That is also consistent with the Government’s Code of Practice on Consultation. I turn to the detail of Amendment 79. In consideration of earlier clauses in Part 2, the Government have explained the reasons why it is necessary for much of the detailed implementation of their proposal in respect of pensions to be through secondary legislation that will be made by the Secretary of State. I hope that the detailed scrutiny of the powers has been helpful in explaining how and for what purpose it is intended that those powers should be exercised. In addition, it has highlighted the significant protection for members offered by Clause 19, which directly constrains the key order-making powers. The amendment proposes changing the procedure for parliamentary approval of orders made under Part 2 from negative to affirmative. The Government do not consider the affirmative procedure to be the better option and cannot support the amendment. They believe that the negative procedure is justified by the significant protections in the Bill relating to how and for what purposes those powers can be exercised. It is also consistent with the procedure used for comparable measures in earlier legislation; for example, Section 106 of the Electricity Act 1989 and Section 33 of the British Telecommunications Act 1981. The Government’s proposals for use of the negative resolution procedure in this respect have been endorsed by the Delegated Powers and Regulatory Reform Committee, a committee by which I know the noble Lord, Lord Skelmersdale, places great store. Noting the arguments both for and against the use of a negative procedure, the committee concluded in its report that, ""in view of the great majority of precedents, the Committee is content that the negative procedure is not inappropriate for instruments under these powers"." In light of my explanation, I invite noble Lords not to press their three amendments.