§ 10. Sir B. Rhys Williamsasked the Secretary of State for Social Services what steps he proposes to take to protect the pension rights of beneficiaries of occupational pension schemes which have accrued before 1972.
§ Mr. EnnalsI would ask the hon. Gentleman to await the publication of the National Superannuation and Social Insurance Bill on Wednesday.
§ Sir B. Rhys WilliamsDoes the Minister of State accept the principle that a pension is a form of deferred pay?
§ Mr. EnnalsThis is certainly a very fair principle to be accepted as regards occupational pensions.
§ Mr. MarksIs my hon. Friend aware that under existing occupational schemes employees who leave the service of their firms do not get the deferred pay which was the employers' contribution?
§ Mr. EnnalsThis is so. One of the disturbing facts is the number of those leaving pensionable employment without any preserved pension but only a cash sum, which is by no means comparable with a pension. This is why we are dealing with the question of preservation of pension rights in the new legislation.
§ 18. Mr. Boyd-Carpenterasked the Secretary of State for Social Services if, in his forthcoming White Paper on Social Security, he will indicate the effect of his proposed legislation on existing public service pension schemes.
§ Mr. EnnalsNo, Sir. The White Paper, which we are proposing to publish next Wednesday together with the National Superannuation and Social Insurance Bill, will be an Explanatory Memorandum dealing only with matters contained in that Bill.
§ Mr. Boyd-CarpenterAs these changes will be in occupational schemes, and will be effected by Ministers who presumably already know the contents of the Bill to be published on Wednesday, why cannot the House be informed before we are called upon to vote on this Bill? What will be the effect on these occupational schemes which are of such interest to so many of our constituents?
§ Mr. EnnalsIt is essential that there should be fair and effective consultation between Government Departments and Ministers as well as local authorities which are responsible for employees in the public sector in order that their views should be known, too. It is not the intention of the Government to impose their will. Consultation is absolutely essential, and consultations are now about to begin. But, as the right hon. Gentleman knows, my right hon. Friend and I have given a number of positive assurances in this House about public service pensions.
§ 19. Mr. Fortescueasked the Secretary of State for Social Services what Departmental arrangements he plans for replying to inquiries from pensioners under his proposed new scheme as to the calculation of their pensions.
§ Mr. EnnalsMost such inquiries at present are dealt with by the staff of the Department's local offices, and it is envisaged that this arrangement will continue. Each contributor will receive regular accounts of his dynamised earnings record.
§ Mr. FortescueUnder the proposed new scheme every State pensioner will have a different retirement pension from every other State pensioner in the land. Does the Minister not accept that this will mean an infinity of inquiries, since those who have lower pensions than others will not believe that they have been treated with justice, even if they have been?
§ Mr. EnnalsIt is also true that the existing hybrid scheme which was introduced by the hon. Gentleman's right hon. Friend produces different results according to earnings levels, as it does also in occupational pensions schemes. But I can assure the hon. Gentleman that since we are introducing a system by which contributors to National Insurance will every year receive a record indicating what earnings they have had over the years which will entitle them to a pension, they will be far better informed than they are at present.
§ 20. Sir B. Rhys Williamsasked the Secretary of State for Social Services what estimate he has made of the proportion 901 of their own and their employers' contributions combined to be returned to beneficiaries of the proposed new pension scheme as graduated pension who retired after 20 years' membership of it, in cases where they had earned throughout the period the national average wage, half the national average wage, one and a half times the national average wage, and three times the national average wage, respectively.
§ Mr. EnnalsIgnoring insurance under the present scheme, future changes in the levels; of prices, earnings, contributions and pensions, and the effect of interest and any alteration in average life expectancy, the amount paid by way of pension to a single man retiring at age 65, having had earnings at the specified level in every week, would be two and three-quarter times, nearly four times, rather under two-and-a-half times and a little over one-and-a-half times, respectively, the amount paid by way of contributions, assuming no abatement for contracting out. In the case of a married man with a wife five years younger than himself, the comparable figures would be rather over five-and-a-half times, eight times, four-and-a-half times and three times respectively.
§ Sir B. Rhys WilliamsIs it not clear that these figures mean that beneficiaries of the State scheme will be getting completely unequal treatment, and that if the Minister insists on embodying in his Bill the principle of the redistribution of savings, it will never have public support?
§ Mr. EnnalsI do not for a moment accept that suggestion. I have little doubt that there will be great public support for a principle which is far fairer, by which people pay according to their earnings and have benefits which are related to their contributions. Of course, it is much fairer.