HC Deb 08 May 1973 vol 856 cc313-32

(1) It shall be the duty of the Government Actuary to report to the Secretary of State, at intervals no greater than two years, on:

  1. (a) the age composition of members of pension schemes,
  2. (b) the number of persons over the age of 45 covered by pension schemes of different kinds,
  3. (c) the pension entitlement which will be acquired under the scheme at the statutory age of retirement or the age of retirement specified by the scheme, by members of pension schemes who at the date of the report are over the age of 45, and in such groupings and on such assumptions as seem to him appropriate.

(2) The Secretary of State may by regulation specify such other matters relating to the pension position of persons over the age of 45 as it seems to him should be covered in the Government Actuary's report.

Brought up, and read the First time.

Mr. Dell

I beg to move, That the clause be read a Second time.

Mr. Deputy Speaker (Mr. E. L. Mallalieu)

It will be convenient to discuss at the same time new Clause 8;

REVIEW OF RESERVE PENSION SCHEME

'(1) The Secretary of State shall, at five yearly intervals (or more frequently if he thinks fit) review the conditions of, contribution requirements for, and benefits paid by the reserve pension scheme.

The Secretary of State shall prepare a report on the scheme following each such review, and copies of the report shall be laid before each House of Parliament.

The first such review shall be completed not later than 31st December 1978'.

8.30 p.m.

Mr. Dell

The House may be relieved to notice that this is the last new clause in which I have taken a lead, although I saw fit to offer my support to new Clauses 7 and 8 in the name of the hon. Member for Kensington, South (Sir B. Rhys Williams).

This new clause asks for reports to be made at intervals no greater than two years on the pensions position of older people. The reason for calling for special reports by the Government Actuary is that I believe that the position of older people is gravely endangered by the Bill. I am speaking now of people over the age of, say, 45. I shall explain why I take that view in respect of both the reserve pension scheme and the occupational pension scheme.

Speaking specifically of people of, for example, 45 years of age and upwards, let us consider their position within the reserve pension scheme. First, they will get pathetically small pensions compared, for example, with what supplementary benefit would provide for them. Indeed, even taking account of such disregards as may be available, they may find that their real net increase in income as a result of many years' contributions to the reserve pension scheme will be very small.

In Committee, by means of an amendment to Schedule 18, I attempted to raise the reserve pension provision for older people, but this was defeated on a vote because—this was the argument employed against it—it needed a cross-subsidy from employers and younger workers, and the Government thought that such a cross-subsidy was inappropriate within a fallback scheme such as the reserve pension scheme. The argument was that, unlike occupational pension schemes, where this kind of cross-subsidy takes place, there is no community of interest within the reserve pension scheme and that it would therefore be quite inappropriate to have such a cross-subsidy.

I have never followed the argument based on lack of a community of interest, because there is no greater community of interest within the basic pension scheme than there is within the reserve pension scheme. But within the basic scheme the Government are proposing, despite the lack of a community of interest, to have cross-subsidies from people who are slightly better off to people who are worse off. So the problem which exists under the reserve pension scheme as the Government are proposing it is that after many years of contribution older workers will get very poor benefits.

Let us consider the position under the occupational pension provisions within the Bill. The minimum benefits here also give poor pensions for older workers, especially in the first 20 years of operation of the scheme. I am speaking of minimum benefits. This does not of course apply to final salary scheme, as I said in the last debate. Those benefits are well above the minimum benefit. But it applies to the minimum benefit laid down within this scheme, particularly if it is a money purchase scheme; and even if it is an average salary scheme such as the normal type of minimum benefit, the 1 per cent. or 1½25 per cent. per annum type of scheme that is proposed if the minimum benefits of this scheme, as laid down in the Bill, are finally passed.

The first point, therefore, is that the minimum benefits will be poor. They will be poor even if it is that kind of average salary scheme, and very poor if, as is not unlikely, employers use the opportunity of the money purchase alternative in the Bill to use money purchase schemes in respect of older workers. In that case it will be very much worse.

In Committee the Government agreed to make regulations under Clause 50 prohibiting the exclusion of older workers in employment from an occupational pension scheme. As I argued for that provision to be made I can hardly do other than welcome it. It is good as far as it goes. The trouble with the Bill is that within it all silver linings have their cloud. In an average salary scheme, for example, the kind of scheme laid down here—the 1 per cent. or 1½25 per cent. scheme—it will be very expensive for an employer to provide that kind of minimum benefit for a person who is 55 years old. It could cost total contributions of 8 per cent. or 9 per cent. I discount such exceptional examples as the hon. Member for Kensington, South gives, but I also accept the point that, given the high rates of interest, the 8 per cent. or 9 per cent. could fall. It would still be expensive to provide the minimum benefits laid down in the Bill to a person of 55.

The Government may say that they will not allow an employer to exclude such a person from an occupational pension scheme. There is, unfortunately, one way in which an employer can exclude such a person from a scheme and against which the Government cannot guard. The employer may decide that the man of 55 is too old to employ, and that it would cost the employer too much. So there is a danger, within the Bill, that it will become more difficult for older people to secure employment. In some cases employers are likely to refuse to employ them because they cost more. There is a serious danger that the Government's second pension scheme will make it more difficult for older people to get employment in firms with occupational pension schemes. Such firms are estimated to have at least half, and probably more, of the employees eligible under the Bill.

There is another danger for older people as a result of the occupational pension scheme provisions. Money purchase schemes, with their poor return to older workers, will be very attractive to employers where the age structure is higher than the average. On the other hand, average salary schemes will be used where the age structure is lower than average. For the beneficiaries, however, it should be the other way round. The older worker wants a guarantee at least of an average salary scheme, poor as the minimum benefits are, and, better still, of a final salary scheme, which is far outside the vision of the Bill. For younger people the advantage will lie in the money purchase scheme rather than the average salary scheme, even the money purchase scheme as laid down in the minimum levels of the Bill. For the beneficiaries, therefore, the Bill seeks to achieve exactly the opposite to what they require.

The older person needs more and is likely to get less; the younger person will be incorporated probably in an average salary scheme, and he will pay the cost of it. I do not object to that. I have argued that there should be a subsidy from younger people to older people, but the older person is likely to suffer. The situation needs to be watched. I would have preferred the Government to accept, in Committee, the amendment that would have improved the minimum benefits to older people, changed the nature of the reserve scheme, and taken particular account of the difficulties for older people. Unfortunately, the Government resisted us all along the road, except on the point I mentioned earlier, which means that they will ensure that employers cannot exclude older people in employment from their occupational pension schemes. This has a corresponding disadvantage, in that they may then be excluded from employment altogether.

The Secretary of State will see that the new clause mentions specifically three types of matter on which the Government Actuary is required to report. Subsection (l)(a) refers to the age composition of members of pension schemes. The object of that, among other things, is that it will show whether older people are finding it difficult to get employment. We should be able to compare the age composition of the members of pension schemes with the age composition of the employable population as a whole, and then see whether older people were finding it difficult to get jobs.

Subsection (l)(b) refers to the number of persons over the age of 45 covered by pensions schemes of different kinds. That would show whether—as I suspect may happen—older people are being forced into employments, covered either by the reserve pension scheme or by money purchase schemes. Both types provide particularly badly for older workers.

Subsection (l)(c) refers to the estimate that I place upon the shoulders for the Government Actuary to make for the eventual pensions entitlement of such persons on reasonable assumptions. That will show us how badly older persons are doing anyhow.

Those are pieces of information which should be available to the Secretary of State as he watches the progress of his legislation. They should also be available to the country at the same time. It is vital that all this information should be known, so that the Government of the day, of whatever colour, can take appropriate action. The appropriate action required would probably be some cross-subsidy to older people within the reserve pension scheme, plus better control of money purchase schemes within the occupational pensions sector, plus better minimum benefits, plus a minimum employer's contribution, such as the House has just rejected.

With the advantage of hindsight, which the right hon. Gentleman said he had used in respect of earlier amendments, based on information of the report the Government Actuary will provide, he may later be able to tell the House that the Opposition were right on 8th May 1973 to suggest that there should be a minimum employers' contribution, and that he now accepts their advice and will make provision for the new legislation accordingly. I fear, however, that it will fall to a different Government to do that.

Sir B. Rhys Williams

In your wisdom, you were kind enough, Mr. Speaker, to include my new Clause 8 with new Clause 6, recognising that the point I sought to make in new Clause 8 was of a similar character to those just made by the right hon. Member for Birkenhead (Mr. Dell). I should like to explain to my right hon. Friend and to the House why I believe new Clause 8 has a certain value in its own right. I mentioned earlier that I was concerned that responsible life offices were making quotations for occupational pension schemes which require very low contributions, and which would still be compatible with the terms of the Bill.

We have to recognise that the reserve scheme itself is not a generous one. It would be true to call it a mean scheme, because this country has not got the savings habit. It may be that in Victorian times some classes had the savings habit, but many millions were too poor to save. Now, in the latter part of the twentieth century—the age of the common man— we have to encourage the entire population to embrace the savings habit which was the foundation of the wealth and success of the few in the last century. That has not yet happened, and the bulk of the employees who may find themselves in the reserve scheme or the occupational scheme will not be anxious for their contributions to be increased, even though it will be transparently obvious to them that their income on retirement would be correspondingly improved if they did. My right hon. Friend should not be discouraged if the reserve scheme cannot, by the nature of things—and by the nature of public opinion—be as generous as he and all Members on either side of the House would like. The National Insurance Scheme began miserably, too, and has grown into something which brings substantial benefits to millions in retirement, although we are not yet satisfied with that.

8.45 p.m.

At any rate, national insurance benefits in retirement are infinitely better than they were even between the wars and certainly better than the way national insurance began before the First World War. We expect it to be improving steadily, and it is subject now to an annual review. But we should make it clear that the reserve scheme is also to be a scheme which is improving constantly as people recognise more and more the wisdom of setting aside money to provide them with a retirement income.

The reserve scheme is not an agency for the redistribution of income, as is the national insurance scheme. Therefore it would not be appropriate to try to institute an annual review. It would be much too complex a matter and so much would depend on it in the way of revision of the terms for occupational schemes that it would be a disastrous idea. But it would be helpful to include from the start a time table for the improvement of the reserve scheme, first because it would encourage people to look for a rising rate of saving and investment through retirement plans of various kinds and, secondly, and perhaps more important in the immediate context, because it would help employers recognise that the reserve scheme is not or should not be a soft option.

I know that my right hon. Friend is rightly afraid that employers who are not well disposed towards providing generous retirement benefits for their employees will wish to comply with the Act in such a way that it costs them the very minimum possible. I do not believe that employers will be able to get away with that, and it is up to the trade unions to make sure that they do not. But there is the risk that there will be short-sighted employers who see the scheme simply as a way of meeting the requirements of the Act grudgingly and costing them only very small contributions. We should make it clear that employers will be wrong to assume that the reserve scheme is a kind of bargain basement. It should be seen instead as an escalator. Employers who join it should realise that after the first five-yearly review their contributions are almost certain to be increased and that after the next five-yearly review they can be reasonably confident that they will be increased again.

There has been an assumption—and I believe that my right hon. Friend has had this feeling—that the reserve scheme is not readily capable of improvement and that because such a large scheme is likely to have millions of members it will not be possible for Parliament to improve it from time to time. That is not so. On the face of it the reserve scheme is more likely to be capable of improvement than the great run of occupational schemes, many of which have complex provisions not only in terms of compatibility with this Bill but also from the tax angle.

There is also the question of the law affecting trusts, the law of perpetuities and the law of the amendment of trusts, which I do not understand but which is a vexatious subject for those who have become extreme specialists in the subject.

I hope and believe that the reserve scheme will be improved with the passage of time and probably transformed out of all recognition. There must be a parliamentary campaign for bigger contributions to the scheme and for bigger benefits in the scheme. I put the contributions first because, unless they go up first, the bigger benefits cannot come afterwards.

I hope that we shall hear from my right hon. Friend that he accepts the ideas that I have been putting forward in connection with my new clause. It has not been selected for a separate Division and therefore it would be wrong for me to prolong my remarks. However, I hope that I may have contributed to starting a campaign for a better reserve scheme and that my campaign will be welcomed by my right hon. Friend.

Sir K. Joseph

Both the right hon. Member for Birkenhead (Mr. Dell) and my hon. Friend the Member for Kensington, South (Sir B. Rhys-Williams) share a desire to see that these schemes develop to their best potential. There is no doubt that we all—including the Government— want both the recognised occupational pensions scheme movement and the reserve scheme to have full publicity. The only reason why I am asking hon. Members not to press their amendments is that I am not sure that their methods are exactly suitable.

First, perhaps, I should deal with the underlying worry of the right hon. Member for Birkenhead about the vulnerable position of elderly members of recognised occupational pensions schemes. The right hon. Gentleman rightly drew attention to the relatively heavy cost of satisfying the minimum recognition benefits for members of the age of 50 and above, but he spoke as if there would be firms whose membership would be solely composed of above-average-age people. That is, in theory, possible, but the presence in a staff of a proportion of people between 50 and 65 will normally—in most firms, not always—be balanced by a proportion of people between 20 and 30. It is, after all, the average cost for the employee that the employer will have to bear in mind in deciding whether to have a recognised occupational pensions scheme.

Mr. Dell

The right hon. Gentleman has missed the point. I recognise the fact that the Government have decided that they will make regulations covering this point so that older people in employment cannot be excluded from occupational pension schemes. My worry is not specific in respect of such persons. My worry is in respect of such persons who apply for employment, and in respect of whom the employer will realise that he will have to pay a very large percentage relative to what he is paying for other employees if he employs that man. That is the point.

Sir K. Joseph

In theory, that might be a worry. But after all, we have enough occupational pensions schemes in this country. They are not so widespread or of as high a quality as we would wish, but we have enough for this danger to emerged. There are a large number of firms who have good quality occupational pension schemes where there has been no whisper that their recruitment policy has damaged the elderly candidate.

Anyway, the right hon. Gentleman agrees that the Government have met his objection by undertaking in the Bill to make regulations to require the Occupational Pensions Board to see that no recognised scheme excludes people on age grounds in any unreasonable way. To that extent, therefore, he has expressed a limited degree of satisfaction.

He asked that the Government write into the Bill his new clause, which would impose upon the Government actuarially a number of obligations with the purpose of protecting the above-average-age members of recognised occupational pensions schemes. I must remind the House that by Government Amendment No. 79 there is already a requirement for an annual report by the Occupational Pensions Board. One would imagine that that would be a mine of information. It will be laid before the House and published. Further, by Clause 72 there is to be an annual report by the Reserve Scheme Board, another mine of information that will be laid before the House and published.

There will be regular reviews of the reserve scheme by the Government Actuary on what I expect to be a three-yearly basis under Clause 71(6). There will be frequent reviews, not necessarily on a regular basis, of the occupational scheme movement by the Government Actuary in future as there have been in the past. There will thus be a regular flood of information coming before the House and the public. While it would be dangerous and wrong not to have enough information, it might be unsettling to have too regular an examination of the actuarial results. Hon. Members will appreciate that we have to get a balance.

Upon my assurance that there will certainly be reports from the Government Actuary on occupational pensions and that I and the Occupational Pensions Board will note the right hon. Gentleman's special interest in the elderly members of such schemes, I hope that he will not press his clause.

I turn to my hon. Friend the Member for Kensington, South, with whose hopes for the future I warmly associate myself in general. I ask him to recognise that there will be three-yearly reviews by the Government Actuary of the reserve scheme. His clause requires five-yearly reviews. To couple a cycle of five-yearly reviews with a cycle of three-yearly reviews would not achieve his purpose.

Sir B. Rhys Williams

It would have been better if I had said three-yearly reviews. I omitted to recollect that there was already a three-yearly timetable.

Sir K. Joseph

I am glad that we are for once ahead of my hon. Friend on the Bill. Under Clause 71(6) there is provision for a three-yearly timetable. While I found my hon. Friend's speech interesting, I hope that in the light of Clause 71(6) he will not press his clause.

I do not know whether I have persuaded my hon. Friend and the right hon. Gentleman not to press their clauses, but there will certainly be no lack of information.

Mr. George Cunningham

Both clauses relate to information about the reserve scheme and occupational schemes—the breakdown of contributions and so on.

I say sincerely and seriously to the Minister that he has not taken any oportunity to say something about what I am sure he realises was an unfortunate misstatement of fact on the contributions to the reserve scheme in relation to other schemes when he spoke in the Second Reading debate on 28th November. He knows the point to which I am referring. Surely it would be appropriate for him now to correct the mis-statement which he made on that occasion, I have no doubt unwittingly and by accident. It should not be allowed to stand on the record without further comment from the Minister.

Sir K. Joseph

I am not one to hug my mistakes to myself. If I have made them I acknowledge them. I am not aware of any wrong-doing. I may have used a slipshod expression and given a false impression which I should not like to leave uncorrected. Will the hon. Gentleman allow me during the rest of today and tomorrow to take a suitable opportunity to look at the point and, if I think it necessary and appropriate, to say something about it?

Mr. Cunningham

I have put down an early day motion on the Order Paper criticising the right hon. Gentleman on this point, having first given notice to his office that I would do so. He may have as much time as he likes. I cannot force him to make a statement, but it is odd for him to suggest that he is unaware of the criticism I am making when that criticism has appeared for weeks on the Order Paper. I shall not pursue it now.

Sir K. Joseph

My conscience was clear. I am afraid that I did not follow it up in great detail, but I will take the opportunity to do so now.

9.0 p.m.

Mr. Meacher

New Clause 6 requires the Government Actuary to report at two-yearly intervals with particular reference to the age composition of members of pension schemes. I listened carefully to what the Secretary of State said, and I acknowledge that there are annual reports from the Occupational Pensions Board and the Reserve Pension Board and a three-yearly review from the Government Actuary. But no provision is made for special reference to older workers. He indicated that he would see that this information was made available. There is a grave need for information to be made available for older workers, for there is no doubt that as the Bill stands they are a group which clearly will do very badly along with women and low-paid workers.

We need a great deal more information than we have at present since the Occupational Pensions Board has considerable discretionary powers under Clauses 50, 55 and 57. We need information about the outcome of reviews under Clause 65, and reports on specimen cases to show the operation of the preservation provisions, which are particularly important for older workers. Above all, we need to know the level of pensions in payment and bonuses in operation. We need to know the number of occupational pensions schemes recognised in relation to the minimum conditions for recognition and the level of employers' and employees' contributions.

It is important to draw attention to the fact that flat-rate accrual schemes after the 1959 Boyd-Carpenter Act largely came about, I suspect, because insufficient attention was drawn to the way in which the provisions of that Act were being unsatisfactorily avoided. There is certainly a need for more information about the way in which older workers have their pension rights provided for. Secondly—this is why we are so concerned—employers, as my right hon. Friend the Member for Birkenhead (Mr. Dell) said so forcefully, certainly have an incentive to and may well exclude older workers. After all, an employer can reduce the total contribution required to provide a minimum benefit, for example by excluding certain categories of workers at his discretion— either through a higher turnover so that the money accrues to occupational schemes because the preservation provisions are so bad, or by excluding older workers.

The reason why occupational scheme workers' benefits are better for 20 years than the benefits in the reserve scheme is seen if one looks at the answer which the Government gave to a Question on 2nd March to the effect that the employer pays more for older workers and obviously has an incentive to escape the liability. If an employer were to exclude those over 55 years of age, the total contribution necessary to reduce minimum pension would be cut by 1 per cent. We need very much to know the employers' contribution levels and the investment policy of the scheme. This is something which should be written into the requirements for provision of information a great deal more precisely than at present.

In Committee the Under-Secretary informed us that this was unlikely to happen because such a scheme would not get recognition. He said later, rather less strongly, that there is little doubt that the board could be used to prevent such a practice because of recourse to regulations under Clause 52. When we looked at those regulations we saw that it was said that no regulations restricting the categories or descriptions of earners who may be included in or excluded from a survey are envisaged at present. That is a very significant statement. At the time the Under-Secretary made clear, that the document was purely consultative and, because it was consultative, in the nature of the case it was not final.

I would have thought it perfectly clear to any objective person looking at those regulations that the Department was at least prepared to put the interests of older workers very much at risk in saying that no such protection was envisaged at present. That was tantamount to saying that, unless pushed rather hard, that is how things will be left, which is rather worrying for older workers. It is relevant to point out that the Explanatory Memorandum dealing with the Crossman scheme explicitly forbade this kind of undesirable practice.

I turn to the situation regarding older workers and the reserve pension scheme. Older workers, women and the low-paid will do particularly badly under the scheme. There is no subsidy, as there is in occupational pension schemes. My right hon. Friend the Member for Birken-head has asked why the reserve pension scheme should be a money purchase scheme. The only indication that has been given by the Government is that the scheme has intermittent membership and lacks any common group identity. The point is that although undoubtedly the membership will be partly intermittent, it is also true that many lower-paid workers, particularly women, will be in the reserve pension scheme all their lives.

Following the introduction of this Bill the older workers will do badly. We have it on the word of the Undersecretary that the reserve pension scheme gives value for money—a phrase which we have repeatedly had thrown at us. What it means is that, because of the absence of cross-subsidy, older workers— those over 45—will get extremely tiny pensions. Anyone who doubts this should look at those interesting figures in HANSARD on 1st March. They are derisorily small pensions for older workers at the start of the scheme. The Under-Secretary went on to say: anyone who has gone half way through his working life without having had the opportunity to build up pension rights will get an inadequate pension unless it is subsidised by someone."—[OFFICIAL REPORT, Standing Committee E, 3rd April 1973; c. 1425.] There we have it. It will not be subsidised by someone in the case of the older worker who was put in the reserve pension scheme when it came into operation. In the words of the Minister it will be an inadequate pension.

I come to those who will have had a chance in the early part of their life to build up pension rights and who may at a later stage find themselves in the reserve pension scheme. If we take account of the basic pension, and that is to be uprated in line with national average earnings, which is considerably better than mere price protection, and if we take into account the level of benefit that workers will receive in the reserve pension scheme, we have a picture of the two-tier pension, the second pension and the basic pension about which the Government have spoken so much.

We see then that a man earning slightly below average earnings, below £30 a week, will need 35 years of contributions to get above the supplementary benefit poverty line. If he is on £20 a week he will need 40 years to do so. That is a pretty clear indictment which shows how bad the reserve pension scheme is for older workers even if they have had a chance earlier in life to build up their entitlements within the scheme. From the table in Schedule 18 one can see that many older workers will be even worse off than under the Boyd-Carpenter Act, which became universally known as a pension swindle. That Act gave 2½p for every £7.50 block of contributions. Under the Bill, according to the table a man of 60 would receive l.52p per £7.50, which is considerably worse than the Boyd-Carpenter formula. A man would need to be as young as 45 to get an accrual rate even as good as the Boyd-Carpenter scheme.

The reserve scheme offers a bonus. The bonus does not even guarantee price protection, so tt is not a particularly generous guarantee of a bonus. Therefore, although the figures would be improved they are unlikely to be improved significantly, and will probably not be better than the Boyd-Carpenter scheme. I can only conclude that for older workers, if the Boyd-Carpenter scheme was Swindle Mark I this scheme is Swindle Mark II.

What we have proposed is partly contained in Amendment No. 131, which was dealt with earlier, which proposed that there should be from the age of 40 onwards the same rate of accrual for every £1 of reckonable contributions. By comparison, in the occupational scheme the older worker does better, as the minimum accrual rate is independent of his contributions. The extra benefit for older workers in the occupational scheme comes from employers and younger employees. If this is true in the occupational scheme, why should it not be true in the reserve scheme?

It has been estimated that employers in occupational schemes have to pay about 1 per cent. more for persons over 45 than they have to pay for younger employees at minimum benefit level. Therefore, if there is a uniform age distribution in the reserve scheme what is needed is an extra 1 per cent. contribution over the whole scheme from all employees.

When we proposed that in Committee it was rejected. The reason was that it would uprate and improve the reserve scheme, and that the extent to which it did that it would make it more difficult for those marginal employers among whom the Government are so determined that they shall spread and advance occupational pension schemes. That is why the reserve scheme is held back. If it were improved it would be more difficult to achieve the central goal of the Bill—to extend the occupational scheme.

One of the casualties of the ideological motive is older workers, who are at the heart of the amendment. I know that the Government are opposed to cross-subsidy in reserve schemes because of the intermittent membership. If so, why have they, in introducing a flat-rate basic pension in return for a fully earnings-related contribution, by that achieved a situation in which the higher-paid are automatically bound to subsidise the lower-paid?

I am fully in agreement with the principle. If the Government can do that for the basic pension, why can they not do it on the basis that there is the same lack of community of interest for those joined together in the basic pension as for those joined together in the reserve pension scheme? If it can be done for the one, it can be done for the other.

This does not help those lower-paid, young or old, in all the changes and improvements proposed for older workers. It is impossible to do that within this structure. This can be done only by the kind of redistributive dynamism which was achieved under the Crossman scheme under the 60/25 formula. I hope that I have made it perfectly clear that there are grounds for real and deep alarm about the position of older workers if we retain, as we are bound to do now, the reserve pension scheme and the occupational pension scheme within the present structure.

9.15 p.m.

The reason we intend to press the new clause is that it is not enough to say that a great deal of information is coming forward. We have had a fair amount of information from the Government Actuary before, but there has been little emphasis on older workers. Unless we receive a definite assurance that information about older workers will be made available as fully as the clause provides for, I shall recommend my right hon. and hon. Friends to press the clause to a Division, because we feel that the situation is so bad for older workers under the scheme.

Mr. Dell

To me, the most surprising element in the Secretary of State's reply was his statement that he was not aware of any employment difficulties for older workers arising out of the existence of occupational pension schemes. I should have thought that the best-known thing about such schemes was that they cause difficulties for older workers in securing employment, because of the cost to employers of the pensions that they eventually have to provide for those older workers. If the Secretary of State is ignorant of that, I can draw to his attention many cases of such difficulty that have come to me in my advice bureau, and cases that I know outside my constituency work.

I have reason to fear that the existence of this type of minimum benefit within the occupational pensions scheme will cause difficulties in securing employment for older people. The more conscious private employers have become of employment costs, the more the membership of the occupational pensions sector has

declined. Those figures are shown in the recent report of the Government Actuary.

The Secretary of State draws my attention to Government Amendment No. 79, requiring an annual report from the Occupational Pensions Board. He says that that should suffice, and that we do not need the clause. I hesitate to remind him that that amendment, again, follows an amendment that I moved in Committee. I shall welcome it, although I hope to move an amendment to it.

The clause is, in part at any rate, a device. It draws attention to the particular and difficult position in which older people will find themselves. Simply to register that point, if for no other reason, I hope that the House will support the clause.

Question put, That the clause be read a Second time: —

The House divided: Ayes 169, Noes 194.

Division No. 124.] AYES [9.18 p.m.
Abse, Leo Ellis, Tom Leonard, Dick
Archer, peter (Rowley Regis) English, Michael Lipton, Marcus
Ashton, Joe Ewing, Harry Lomas, Kenneth
Bagier, Gordon A. T. Faulds, Andrew Loughlin, Charles
Barnett, Joel (Heywood and Royton) Fernyhough, Rt. Hn. E. Lyon, Alexander W. (York)
Baxter, William Fitch, Alan (Wigan) Mabon, Dr. J. Dickson
Beaney, Alan Fletcher, Raymond (Ilkeston) McBride, Neil
Bishop, E. S. Fletcher, Ted (Darlington) McElhone, Frank
Blenkinsop, Arthur Foot, Michael McGuire, Michael
Boardman, H. (Leigh) Ford, Ben Machin, George
Booth Albert Galpern, Sir Myer Mackintosh, John P.
Bottomley, Rt. Hn. Arthur Gilbert, Dr. John McMillan, Tom (Glasgow, C.)
Broughton, Sir Alfred Gourlay, Harry McNamara, J. Kevin
Brown, Robert C. (Nc'tle-u-Tyne,W.) Grant, George (Morpeth) Marks, Kenneth
Brown, Hugh D. (G'gow, Provan) Griffiths, Eddie (Brightside) Marsden, F
Brown, Ronald(Shoreditch & F'bury) Hamilton, James (Bothwell) Marshall, Dr. Edmund
Buchan, Norman Hamilton, William (Fife, W.) Mason, Rt. Hn. Roy
Buchanan, Richard (G'gow, Sp'burn) Hardy, Peter Meacher, Michael
Butler, Mrs. Joyce (Wood Green) Harrison, Walter (Wakefield) Mellish, Rt. Hn. Robert
Campbell, I. (Dunbartonshire, W.) Heffer, Eric S. Mendeison, John
Carmichael, Neil Horam, John Millan, Bruce
Carter-Jones, Lewis (Eccles) Houghton Rt. Hn. Douglas Mitchell, R. C. (S'hampton, Itchen)
Castle, Rt. Hn. Barbara Huckfield Leslie Molloy, William
Clark, David (Colne Valley) Hughes, Rt. Hn. Cledwyn (Anglesey) Morgan Elystan (Cardiganshire)
Cohen, Stanley Hughes, Mark (Durham) Morris, Alfred (Wythenshawe)
Coleman, Donald Muahea Robert (Aberdeen, N.) Moyle, Roland
Concannon, J. D. Hunter Adam Mulley, Rt. Hn. Frederick
Conlan Bernard Irvine, Rt. Hn. Sir Arthur (Edge Hill) Oakes, Gordon
Crawshaw, Richard Janner, Greville Ogden, Eric
Crosland, Rt. Hn. Anthony Jenkins, Hugh (Putney) O'Halloran, Michael
Cunningham, G. (Islington, S.W.) John, Brynmor O'Malley, Brian
Cunningham, Dr. J. A. (Whitehaven) Orbach, Maurice
Dalyell, Tarn Johnson, Jemes (K'ston-on-Hull, W.) Oswald, Thomas
Davidson, Arthur Johnson, Walter (Derby, S.) Palmer, Arthur
Davies, G. Elfed (Rhondda, E.) Jones, Barry (Flint, E.) Pardoe, John
Davis, Clinton (Hackney, C.) Jones, Gwynoro (Carmarthen) Parker, John (Dagenham)
Davis, Terry (Bromsgrove) Jones, T. Alee (Rhondda, W.) Parry, Robert (Liverpool, Exchange)
Dell, Rt. Hn. Edmund Judd, Frank Pavitt, Laurie
Doig, Peter Kaufman, Gerald Peart, Rt. Hn. Fred
Douglas, Dick (Stirlingshire, E.) Kelley, Richard Perry, Ernest G.
Douglas-Mann, Bruce Kinnock, Neil Prescott, John
Dunnett, Jack Lamond, James Probert, Arthur
Eadie, Alex Lawson, George Rees, Merlyn (Leeds, S.)
Edwards, William (Merioneth) Lee, Rt. Hn. Frederick Rhodes, Geoffrey
Roberts, Albert (Normanton) Stallard, A. W. Walker, Harold (Doncasler)
Roberts, Rt. Hn. Goronwy (Caernarvon) Steel, David Watkins, David
Robertson, John (Paisley) Stonehouse, Rt. Hn. John Weitzman, David
Roderick, Caerwyn E.(Brc'n& R'dnor) Strang, Gavin Wellbeloved, James
Rose Paul B. Summerskill, Hn. Dr. Shirley White, James (Glasgow, Pollok)
Ross, Rt. Hn. William (Kilmarnock) Thomas, Rt. Hn. George (Cardiff, W.) Whitlock, William
Short, Rt. Hn. Edward (N'c'tle-u-Tyne) Tinn, James Williams, W. T. (Warrington)
Silkin, Rt. Hn. John (Deptford) Tomney, Frank Wilson, Alexander (Hamilton)
Sillars, James Tope, Graham Wilson, William (Coventry, S.)
Silverman, Julius Torney, Tom Woot, Robert
Skinner, Dennis Tuck, Raphael
Small, William Urwin, T. W. TELLERS FOR THE AYES:
Spearing, Nigel Varley, Eric G. Mr. James A. Dunn and
Spriggs, Leslie Wainwright, Edwin Mr. Joseph Harper.
NOES
Adley, Robert Hall, Miss Joan (Keighley) Pike, Miss Mervyn
Alison, Michael (Barkston Ash) Hall, John (Wycombe) Pink, R. Bonner
Allason, James (Hemel Hempstead) Hall-Davis, A. G. F. Powell, Rt. Hn. J. Enoch
Atkins, Humphrey Hamilton, Michael (Salisbury) Price, David (Eastieigh)
Awdry, Daniel Hannam, John (Exeter) Proudfoot, Wilfred
Baker, W. H. K. (Banff) Hastings, Stephen Pym, Rt. Hn. Francis
Balniel, Rt. Hn. Lord Havers, Sir Michael Quennell, Miss J. M.
Batsford, Brian Hawkins, Paul Raison, Timothy
Bennett, Dr. Reginald (Gosport) Hayhoe, Barney Ramsden, Rt. Hn. James
Benyon, W. Holland, Philip Redmond, Robert
Berry, Hn. Anthony Holt, Miss Mary Reed, Laurance (Bolton, E.)
Biffen, John Hordern, Peter Rees-Davies, W. R.
Biggs-Davison, John Hornby, Richard Renton, Rt. Hn. Sir David
Boardman, Tom (Leicester, S.W.) Hornsby-Smith, Rt. Hn. Dame Patricia Roberts, Michael (Cardiff, N.)
Body, Richard Hunt John Roberts, Wyn (Conway)
Boscawen, Hn. Robert Hutchison, Michael Clark Rest, Peter
Bossom, Sir Clive Irvine, Bryant Godman (Rye) Royle, Anthony
Bowden, Andrew James David Russell, Sir Ronald
Brocklebank-Fowler, Christopher Jenkin, Patrick (Woodford) Shaw, Michael (Sc'b'gh & Whitby)
Bryan, Sir Paul Jopling, Michael Simeons, Charles
Buchanan-Smith, Alick (Angus, N&M) Joseph Rt, Hn. Sir Keith Sinclair, Sir George
Buck, Antony Kaberry, Sir Donald Skeet, T. H. H.
Butler Adam (Bosworth) Kellett-Bowman, Mrs. Elaine Smith, Dudley (W'wick & L'mington)
Campbell, Rt. Hn.G. (Moray & Nairn) Kershaw, Anthony Soref, Harold
Carlisle, Mark Kimbail, Marcus Speed, Keith
Cary, Sir Robert King, Evelyn (Dorset, S.) Spence, John
Chapman, Sydney Kinsey, J. R. Sproat, lain
Chataway, Rt. Hn. Christopher Knox, David Stewart-Smith, Geoffrey (Belper)
Chichester-Clark,R. Lamont, Norman Stodart, Anthony (Edinburgh, W.)
Churchill, W. S. Lane, David Stoddart-Scott, Col. Sir M.
Clark, William (Surrey, E.) Langford-Holt, Sir John Stuttaford, Dr. Tom
Cooleram Eric Le Marchant, Spencer Sutcliffe, John
Cooke, Robert Lewis Kenneth (Rutland) Taylor, Sir Charles (Eastbourne)
Cooper, A. E. Loyd, Ian (P'tsm'th, Langstone) Taylor, Edward M.(G'gow,Cathcart)
Cordle, John
Cormack, Patrick Longden, Sir Gilbert Taylor, Frank (Moss Side)
Crltchley, Julian Loveridge, John Tebbit, Norman
Critchley, Julian Luce, R. N. Temple, John M.
Crowder, F. P. MacArthur, Ian Thatcher, Rt. Hn. Mrs. Margaret
d' Avigdor-Goldsmid, Maj.-Gen.Jack McLaren, Martin Thomas, John Stradling (Monmouth)
Dean, Paul Macmillan.Rt.Hn.Maurice (Farnham) Thomas, Rt. Hn. Peter (Hendon, S.)
Deedes, Rt. Hn. W. F.
Digby, Simon Wingfield McNair-Wilson, Michael Thompson, Sir Richard (Croydon, S.)
Dykes, Hugh McNair-Wilson, Patrick (New Forest) Tilney, John
Edwards, Nicholas (Pembroke) Madel, David Trafford, Dr. Anthony
Elliott, R. W. (N'c'tle-upon-Tyne, N.) Maude, Angus Tugendhat, Christopher
Eyre, Reginald Mawby, Ray Turton, Rt. Hn. Sir Robin
Farr John Meyer, Sir Anthony Vickers, Dame Joan
Finsberg, Geoffrey (Hampstead) Miscampbell, Norman Waddington, David
Fisher, Nigel (Surbiton) Mitchell, Lt.-Col.C.(Aberdeenshire. W) Walder, David (Clitheroe)
Fookes Miss Janet Mitchell, David (Basingstoke) Walker, Rt. Hn. Peter (Worcester)
Fortescue, Tim Molyneaux, James Wall, Patrick
Foster, Sir John Monks, Mrs. Connie Ward, Dame Irene
Fowler, Norman Monro, Hector Warren, Denneth
Fox, Marcus Montgomery, Fergus Weatherill, Bernard
Fraser, Rt. Hn. Hugh (St'flord &Stone) More, Jasper Wwlls, John (Maidstone)
Fry, Peter Morgan-Giles, Rear-Adm. White, Roger (Gravesend)
Gibson-Watt, David Morrison, Charles Wiggin, Jerry
Mudd, David Winterton, Nicholas
Glyn, Dr. Alan Nabarro, Sir Gerald Wolrige-Gordon, Patrick
Goodhew, Victor Neave, Airey Woodhouse, Hn. Christopher
Gower, Raymond Nicholls, Sir Harmar Woodnutt, Mark
Grant, Anthony (Harrow, C.) Oppenheim, Mrs. Sally Worsley, Marcus
Gray, Hamish Orr, Capt. L. P. S. Younger, Hn. George
Green, Alan Owen, Idris (Stockport, N.)
Griffiths, Eldon (Bury St. Edmunds) Page, John (Harrow, W.) TELLERS FOR THE NOES:
Grylls, Michael Parkinson, Cecil Mr. Kenneth Clarke and
Gummer, J. Selwyn Percival, Ian Mr. Oscar Murton.

Question accordingly negatived.

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