PENSIONS.

HC Deb 02 November 1993 vol 231 cc262-93

Lords amendment: No. 295, in page 121, line 32, at end insert— ("( ) Nothing in this Act shall relieve the Secretary of State of any duty imposed by section 52D(2) of the Transport Act 1980.")

Mr. MacGregor

I beg to move, That this House doth disagree with the Lords in the said amendment.

Mr. Deputy Speaker

With this, it will be convenient to take the following: Lords amendments Nos. 410 to 415, Lords amendment No. 416, Government amendment (a) thereto, and Lords amendment No. 417.

Mr. MacGregor

There was a discussion on this issue today. Before I come to the technical aspects of the amendments, I will remind the House of the important background to what has been agreed on the subject of pensions. I will repeat the four points that both I and the Minister made earlier.

The first point is that the assets which will move from the existing British Rail scheme to the closed fund—the subject about which we are primarily talking—will be determined on an independent actuarial valuation. I repeat the point, because it is important that it is made clear to all pensioners. There is no question of the funds being siphoned off in any way other than for the purposes of the payment of pensions. The fund will be under the control of the trustees and they will have a fiduciary duty to the trust members. There is no way in which the Government would either wish or be able to purloin any of the funds. I underline that point, because that accusation has been put around the country. It is not our wish in any way, and I hope that that is explicit.

The second point is that the fund will now have the added protection of a solvency guarantee from the Government. That is a totally new position and one to which I shall refer again later. The third and fourth points, which were widely welcomed and acknowledged by my hon. Friends, are that we have given the pensioners an extremely good deal. In addition to that guarantee, they will have an inflation-linked pension. The guarantee for solvency means that they have a guarantee on VAT, which at present they do not enjoy. In addition, the trustees will be able to use up to 40 per cent. of any surpluses in the fund and that is roughly the figure that is used at the moment for the payment of benefits.

Unlike most other funds there is a Government guarantee, an inflation index-linked pension guarantee, and there is the additional ability—the big difference from other index-linked pensions—to benefit from surpluses. That is the background and we have fairly and generously carried out our commitment to the pensioners. Certainly I wished to do that.

The grouping of amendments deals with Government payments under the Transport Act 1980. I will first deal with amendment No. 416 because most of the others in the group follow on from it. The memorandum of understanding between the Government, BR and the BR pension fund trustees deals with protecting the pensions of existing, deferred and future BR pensioners after privatisation while protecting the taxpayers' interests.

The solvency guarantee for the closed fund for existing pensioners, with the agreement that those pensioners may benefit from up to 40 per cent. of any future surplus and the promise of a similar guarantee to the BR residuary section of the joint industry scheme should that section at any time become seriously unstable, secures the future for all BR pensioners present and future. The provisions of the amendment are designed to provide the agreed protection for the taxpayer's interest.

It would be anomalous to continue the supply of public funds under section 52 of the Transport Act 1980 in circumstances in which they were not yet required, because the scheme now has the copper-bottomed security of an absolute solvency guarantee that is backed by public funds. That produces a fundamental difference—a guarantee from the taxpayer—that was never there before.

The hon. Member for Nottingham, East (Mr. Heppell) referred to the situation in 1980 and said that he understood that the position then was, "If your pension went bust, you'd had it." I think that those were pretty much the words he used. The difference now is that, if the situation arises of the fund being deficient, he has not had it. That is a big difference. It is a complete change from the position in 1980. Now he will continue to receive the pension guaranteed by the taxpayer. That is a fundamental difference.

Lords amendment No. 416 introduces three new sections—52B, 52C and 52D—into part III of the Transport Act 1980. The purpose of section 52B is to terminate the support contributions currently payable under section 52 of the 1980 Act in respect of the unfunded obligations acquired by any new pension scheme which has been given a Government solvency guarantee. So the contributions cease where there is a Government solvency guarantee, which is, above all, the closed existing pensioners fund.

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In place of the continuing contributions, a new obligation is proposed under which substitution payments will be made in circumstances to be prescribed by order. As I said, we intend to apply those arrangements principally to the new pensioners' closed section of the joint industry scheme, in line with the memorandum of understanding. But section 52B can equally be exercised in relation to the residual BR section of the joint industry scheme to which I referred earlier if a solvency guarantee is given in the event of the joint actuaries certifying the instability of the fund.

Mr. Prescott

It is complicated.

Mr. MacGregor

I agree that it is a complex and technical matter. That is why I was careful to stick firmly to forms of words which will be understood by everyone involved when they are read in Hansard.

Subsection (5) requires a determination of the capital value of the unfunded obligations. It is worth spending a moment on that because a related issue was raised this afternoon. Subsection (7) (c) provides for the substitution payments to be made in circumstances prescribed in the substitution order. Until the payments have been made or the scheme has been wound up, the Government's liability will not be discharged.

Subsection (7) provides for interest to accrue. The formulation is sufficiently wide for an interest rate to be specified which can equate to that which could otherwise have been earned by the scheme if the trustees had received the cash. In other words, the Government's liabilities to the guaranteed new scheme will continue with interest on the outstanding balance as assets of the scheme until the prescribed circumstances provide for the substitution payments to be made. That obligation, with interest accrued, will be included in every valuation. Therefore, it will be part of the valuation leading to the surplus from which direct payments in cash will go to the pensioners.

Mr. John Heppell (Nottingham, East)

Does the Secretary of State agree that, while the Government have the option not to pay anything into the fund if they do not want to, that is of little interest to the people in the pension fund, because nothing says that the Government have to pay the whole amount into the fund? So the money accrues with more and more interest but does so in the Treasury coffers and not in my pension fund.

Mr. MacGregor

That is not accurate. In circumstances where there is a surplus in the fund as a result of the obligation plus interest, there will be a direct and immediate benefit to the pensioners. That will contribute to the 40 per cent. of surplus which can be paid directly to them. It is a meaningful provision. It means that the obligations exist. I am surprised that the hon. Gentleman does not think that the interest payments matter very much. We were accused earlier of not putting cash in, and therefore not enabling the pension fund to gain anything from that obligation.

With interest applied, there will be a roll-up in the fund. That will contribute to the surplus. So the amendment has real meaning and could mean real cash for the pensioner.

Mr. Heppell

Is the Secretary of State saying that the contributions that the Government are committed to paying under the 1980 Act will continue to be paid? If not, is he saying that the pension fund can receive those payments when it asks for them but not when the Government decide that it does not need it? If so, the Government will say that the fund does not need the contributions because it has a surplus. So the surplus would gradually be reduced. Is it the Government's intention to pay, because have evidence to the effect that their intention is effectively to reduce the contributions depending on the surplus of funds?

Mr. MacGregor

No. Let me make it clear. As I have already said, and as is clear in the amendments, there will not be a direct payment of cash to the pension fund as there was previously because that is now replaced by the solvency guarantee, which is a fundamental difference. There will be a calculation of the unfunded obligation, which will be included in the fund for the purposes of valuation and therefore for the purposes of surpluses, plus the interest that I have already mentioned, which can and will lead to real benefits.

Mr. Prescott

I agree that it is a complex area, but what the Secretary of State has said means that the Treasury, certainly at the moment, will be saving the annual payments that it makes right up to the period when an assessment is made and the IOU has to be delivered. What is the estimate of the amount that the Treasury will be saving for the rest of decade?

Mr. MacGregor

There is no estimate at the moment. The hon. Member for Kingston upon Hull, East (Mr. Prescott) must remember that the taxpayer has a liability and commitment, and there is no way in which the pensioner will lose by this arrangement at present, for the reasons that I have just described.

I shall now deal with the point about timing. The new section 52D, which has been causing concern, includes provisions relating to directions given under the powers contained in sections 52A and 52C and orders made under section 52B. I shall first explain the technicalities. Orders under section 52B will be subject to the negative resolution procedures in common with the other order-making power in part III of the Transport Act 1980. However, section 52D(1) requires prior consultation with the trustees on any such order and section 52D(4) requires a copy of the solvency guarantee to be laid before each House when or before an order is laid. That is the point to which the hon. Member for Kingston upon Hull, East was referring this afternoon.

We are currently in discussion with the pension fund trustees as to how we deal with those extremely complex and technical matters in order to fulfil the arrangements under the memorandum of understanding and the arrangements that I have just described. Those discussions will lead to the laying of the order before the House some time early next year, when we have completed it.

The House will know that this closed fund arrangement does not come into effect before next autumn, so it will be laid before the House well before that and the House will debate and decide on the matters. It will be by negative resolution, but that will enable the House to decide.

Mr. Cryer

There is a problem with laying negative procedure orders. Can the Minister guarantee that, when the order is laid, it will not come into force before Parliament has had the opportunity to make a decision? I must draw to the attention of the Minister examples of cases where orders have been laid in August, immediately after the beginning of the summer recess, which have come into force during the recess before Parliament has had a chance to debate them. Is the Minister saying that, after consultation with the trustees, Parliament will have the chance to make a decision? That assurance must be meaningful so that it will not be a case of trying to roll something that has already come into law.

Mr. MacGregor

I take the point made by the hon. Gentleman. Setting up the scheme will require an affirmative order. As I have said, the scheme is intended to come into operation as a closed fund in October. I understand that it would not be fair either to the pensioners or to the House to follow the sort of timetable that the hon. Gentleman suggested, and it is certainly not our wish to do so. It will obviously depend on how our negotiations go and I cannot give a complete guarantee, but I hope that I have said enough to indicate that I wish to meet his point.

Part of the whole commitment that we have given is that the scheme will come to both Houses for approval. That leads to the—

Ms Glenda Jackson

Will the right hon. Gentleman give way?

Mr. MacGregor

I should get on, because I can then explain the position in total.

That leads to section 52D(2), which was introduced as an amendment on Report in the other place. It would require the prior written agreement of the trustees to be obtained before the Secretary of State laid an order under section 52B. Our amendment (a) to amendment No. 416 will delete that requirement.

I do not see how the House can accept Lords amendment No. 295. As the hon. Member for Wrexham (Dr. Marek) rightly recognised, it could prevent a proposal, in relation both to the scheme as a whole and to public expenditure, from coming before the House. It would give the trustees an effective power of veto over the Government introducing secondary legislation, or control over the timing of payments, under the Transport Act 1980, to the guaranteed BR pensioner scheme.

I have made it clear that the memorandum of understanding, which I have fully read, provides for the trustees' agreement, but it would be wrong to provide in legislation for any private individual or group such as the trustees to have such power in primary legislation. I have been looking at past examples, and that would be unprecedented.

Several hon. Members

rose—

Mr. MacGregor

Let me finish the point. There is a genuine problem, but we have done everything that we reasonably can to solve it. First, the proposed new section requires consultation with the trustees. It is clearly our intention and desire to seek and obtain agreement with the trustees on such matters. We have, as I have already said, started discussions with them. We have put a proposal to them and we await their response. It will be in the interests of all the parties concerned that agreement is reached.

However, we have to protect Parliament. A group of trustees might be able to withhold the putting of proposals before the House or control—having a veto means control —public expenditure proposals put before the House. Ministers will be answerable to Parliament for the way in which they exercise their order-making power. As taxpayers' funds are involved, we believe that that should be a decision for the House and not one taken elsewhere.

I hope that that makes clear what the difficulty is and why we have striven to overcome it. There is no duplicity. We have ended up with an extremely good deal for the pensioners. That is the most important point of all. We have sought to protect Parliament's interest. We have enabled the House to decide on what is quite a technical issue, once we have worked it through with the trustees. I believe that that is a sensible resolution.

I know that the matter will be debated for some time. I assure the House that the remaining amendments in the group are consequential or technical. I commend the other amendments to the House.

Mr. Prescott

When I spoke on the guillotine motion, I made clear my position, and that of the House, over the Government's action on the pensions. I know that other hon. Members have only the best part of an hour in which to speak, so I shall not go into the amendments in detail. The Secretary of State did so, and he spelt out his position, as was proper, because many people will be reading the report of the debates. However, I shall not follow him up that alleyway, because there is not enough time.

The essential issue about the pensions was determined at the beginning, when the Government decided to divide the pension fund into separate groups for separate companies. The Government often said that the tax authorities had forced them to do that, but that is not quite correct, because the tax authorities allow two ways to organise a pension fund.

A general industry fund could have been kept, but the Government decided to reorganise in such a way that it caused a conflict between the bodies, so the tax authorities said that the funds must be reorganised separately, and the problems arise from that. The main concern in this debate has been about the closed fund and pensioners who paid into the 1975 and 1980 funds. The closed fund will now be separated. No extra contributions will be made except those originally identified with the fund—the contribution to be made by the Government for their obligations arising directly from an unfunded pension fund.

That contribution amounts to some £80 million. We could argue about how that is divided between different funds, but it is approximately that amount. As the Treasury will not be paying it every year, it can be calculated to be five or six times £8 million. The Treasury is doing quite well, as it will save £4 billion or £5 billion, possibly more —being a little pessimistic, I think that it will save more —on the basis of providing an IOU.

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The Treasury has undoubtedly gained some assets from the process. It has saved by not paying a contribution to the pension fund, as written into the 1980 legislation. The Government are now offering an alternative—an IOU—and have gained from the process at the pension fund's expense.

At the heart of the debate has been the question whether the Government could reassure the trustees that their actions would meet their original commitment that the pensioners would be no worse off, their security would be guaranteed, and that the Government did not intend to take the funds. I do not agree with that point, but I have already made that clear.

It is only fair to feed into the argument the trustees' views. They have an interest to act on behalf of the pensioners in negotiations with the Government, and must say what they believe the Government intend to do. They recognise that the Government had difficulty in writing the solvency agreement into the Bill, and even recognised certain arguments about the power of veto and whether they could control the fund.

In a properly funded pension fund such as this, which the Government set up when they reorganised pension funds in 1980, the trustees are not obliged to agree with the Government. They have a fiduciary obligation, to which the Secretary of State referred, to manage the fund on behalf of the pensioners. Indeed, when the Government first funded the fund, the present Chancellor of the Exchequer, the then Under-Secretary of State for Transport, said that the fund no longer had anything to do with him and that he was obliged only to make a yearly payment. The same person is now trying to get back the yearly payment from that fund because he has discovered that surpluses have been paid.

The memorandum of understanding was the means by which the Government sought to assure the trustees about their responsibilities, rights and protections. The chairman of the trustees believed that it would protect the pensioners. The trustees made it clear that they hoped that, in accepting the Government's break-up of the fund, solvency and a retail prices index on pension payments would be guaranteed.

The Government said that they intended to give those guarantees, but they made other changes. The trustees then Agreed that the surpluses that were meant to fund the extra value pension increases which railway pensioners had enjoyed because of the good management of the fund, about which we all agree, were not to be put in a fund on the basis of a 60:40 share. That means that 100 per cent. would have been available to the trustees to distribute as they wished. They chose to distribute it on a 60:40 basis, measuring their liabilities against the incomes that they were receiving from the fund.

Now they have no choice. The Government are telling them not only that they must put 60 per cent. into a reserve fund but that an appointed director must agree any investment policy followed by the fund. It seems from that that the trustees are not in the independent position that they occupied before. The appointed director can determine the moneys to go into the fund and the investment programmes. The introduction of the 60:40 share will affect the solvency of the fund. The understanding makes clear that if there is a problem of insolvency in the fund, the Government, through their appointed trustee, can take over and reorganise the fund.

The charge that I have laid at the Government's door is that they were almost building insolvency into the fund. They were making conditions almost perfect for them to move in, take over the fund and reorganise it. It would then become a sort of unfunded fund and would meet the Exchequer's obligations. That would open the door to taking the assets. That creates uncertainty.

The Secretary of State has had correspondence with the chairman of the board, who feels that he has been let down by the Government because he believed that whatever action was taken had to be agreed with the trustees. We now know that that is not the case, as the amendment makes plain, because the Government now speak about consultation. If the Government feel that they cannot grant the right of veto, the complaint of the chairman of the trustees, as spelt out in the letters, should be attended to.

The Secretary of State has had a number of letters from the chairman of the trustees, Mr. Fowler, on 15, 19 and 26 October. We have no record of any replies. Did the Secretary of State reply to the great concerns expressed by the chairman of the board who thought that he had been duped on the memorandum of understanding?

Mr. MacGregor

I had a meeting.

Mr. Prescott

In his final letter, Mr. Fowler complains that he has sent three letters and has not received a reply. That letter states: I am sufficiently experienced in public expenditure matters to know that Government guarantees cannot be given lightly and without sensible controls which protect taxpayers' interests." That is a fair point. The letter continues: Those requirements were recognised in the Memorandum of Understanding. That was an agreement—peace in our time, pensions in our time—that was made before the debate in the Lords.

Mr. Fowler adds: What I had not foreseen when I signed the Memorandum was that the Secretary of State would be given powers to virtually take over the fund if the solvency guarantee were to be invoked. He was a party to the negotiations and signed the paper along with the Minister of State. I do not know why the Secretary of State did not sign, but perhaps unfolding events have made that clear. Mr. Fowler makes it clear that his understanding of the memorandum was entirely different from that of the Secretary of State.

There is a clear division between the Secretary of State, the Government and the other signatory. I do not know what British Rail says about it.

If it was thought that there was a difference over the guarantees on terms and conditions why was the word "agree" in the memorandum? Irrespective of whether it is in statute, if it is in the agreement with good intent that there will be an agreement with the trustees before anything is done, that should have some meaning. Does the memorandum of understanding still apply? Did the Secretary of State say that he would apply the word "agreement"? What happens if there is no agreement? Will he take unilateral action by telling the House, "I could not get an agreement"? If so, that is consultation. The crucial question is why the Secretary of State does not use: the word "agreement".

Mr. MacGregor

Perhaps I may explain again. I was straightforward in explaining the difficulty that we could not avoid the responsibility of the House by granting a veto on matters that should be decided by the House. I shall repeat the exact procedure. We think that we shall reach agreement with the trustees, and that is our wish. When we do, we shall place orders before the House, and it will be for the House and the other place to decide upon them. If there is any disagreement, we shall lay before the House the trustees' comments. That is made clear in one of the sub-paragraphs that I read out. In relation to public expenditure, it is right that the House should decide. There is no question of the Government's taking control and leaving no alternative for the trustees. I repeat that I believe we shall reach agreement.

The hon. Gentleman speaks about the Government effectively taking over the fund. There is no question of the Government's controlling or taking over the fund. However, because the Government, and therefore the taxpayer, are guaranteeing the benefits, we must ensure that the taxpayers' interests are protected. That is the reason for having a Government director on the body of trustees. It is not to control the fund, but simply to ensure that the taxpayer, who has the ultimate liability, is protected should all the funds be paid out to pensioners or otherwise issued.

Therefore, in unreasonable circumstances—I do not believe it will happen, but we have to protect ourselves in legislation—the taxpayers' interests are protected as the taxpayer would be footing the bill. There is no question of the Government's taking over the fund.

Mr. Prescott

We shall have to continue that debate another time, but if the Minister looks at the memorandum of understanding, he will see that his appointed Government director of the trustees, whose consent will be required to the distribution of any surplus, strategic decisions on investment policy and other matters and anything to do with the guarantee of benefits granted from a surplus", will decide on the investment of the special reserve. That is not the trustees; it is the Secretary of State's appointee acting on his instruction. The trustee company is no longer an independent body.

Why does the Secretary of State appoint a director? Why does he make it clear in the memorandum of understanding that trustees no longer have freedom to make such decisions unless the Government-appointed director agrees? Presumably he will ring up the Department of Transport or the Treasury. How can he consider for a second that the. Government are not controlling the fund? I cannot believe that the Secretary of State could possibly have read the memorandum of understanding; if he did, he had a duplicitous way of doing it.

Another example comes from the Minister of State's statement in the other place on 12 October in which he said: The Government regard the memorandum of understanding as binding".—[Official Report, House of Lords, 12 October 1993; Vol. 549, c. 101.] It may be binding on the Government, but it is totally meaningless. It can mean whatever the Secretary of State wants to interpret it to mean. As the lawyers to the trustees fund said, it has no binding in contract law. It cannot be used to claim that the Government are party to a contract as signatory to the document; it cannot be treated as a contract in law. It has no meaning whatsover. It achieved what the Government wanted—it won the vote in July in the House of Lords simply by kidding them.

Mr. MacGregor

Will the hon. Gentleman give way?

Mr. Prescott

There is no point in giving way to the Secretary of State, as some of my hon. Friends want to speak.

The chairman's letter continues: Third, your proposals, as presently stated, will effectively eliminate any possibility of actuarial surpluses arising. This is contrary to one of the basic principles underlying the Memorandum of Understanding. The signature to it says it is contrary to what was agreed. Finally, he said that the Government IOU that would replace various funds and Transport Act payments would have serious implications for the fund. He went on to say the claims on the fund which the Government will now treat as an IOU that those claims on the fund will represent some 25 per cent. of the assets now, and that 10 years' later, 70 per cent. of the assets might be represented by the Government's IOU, thus moving close to an unfunded scheme". It is the chairman of the trustees saying that.

The Secretary of State can disagree with me, but the trustees seem to have backed my interpretation. I have no doubt that nothing today or in the guillotine debate has put to rest my fears that perhaps not the Secretary of State but the Treasury intends eventually to work with the closed fund to an unfunded scheme where eventually the Government will take over control as they have now under the memorandum of understanding which, presumably, the Secretary of State will impose on the trustees.

The Secretary of State controls the fund. It will eventually move to an unfunded scheme and then the Treasury will make a deal with the pensioners, offering them a price-related, inflation-free business pension fund and they will have access to the £2 billion assets exactly as they did with the National Bus funds. Then, when they have established the formula, they will follow it through in the coal industry and the Post Office. These privatisations are solely about robbing the pensioners of their resources and assets, and that is why we will oppose the measure.

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Mr. Bayley

The pensions issue has been a long and sorry saga, yet the Government still do not recognise that, for most railwaymen and women, their pensions represent their life savings. That is why there has been such an outcry from the pensioners about the Government's proposals for their scheme. The Secretary of State's motion to disagree with the Lords amendment would tear up the Government's obligation to contribute to the pension fund under the terms of the 1980 Act. That obligation arose because of the change in 1975 from a pay-as-you-go pension scheme—similar to the national health service scheme—to an asset-based, funded scheme.

In Committee, the Opposition sought a commitment from the Government that they would continue to meet their obligations under the 1980 Act. On 23 March, the Minister for Public Transport—I am tempted to say the Minister for Roger Freeman—said: In 1980, my predecessor—now the Home Secretary—made a commitment under the Transport Act 1980 for the Government to make contributions—now about £70 million per annum—to the pension scheme in order to fund the pre-1975 unfunded liabilities for railwaymen and women. I give my hon. Friend a clear commitment that the Government will continue to make those contributions; they are under an obligation to do so. I am happy to repeat the undertaking that those contributions will continue to be made in the future because the obligations continue."—[Official Report, Standing Committee B, 23 March 1993; c. 915.] The Minister could hardly have been more clear than that.

Mr. Freeman

So that there is no misunderstanding, I must clarify that the commitment that the hon. Gentleman cited was given before the meeting with the trustees in July, when they rejected the outcome of our discussions in Committee and said that they wanted a guarantee that the undertaking of cash payments under the 1980 Act applied to a set of circumstances where there was no state guarantee of an index-linked pension. Everything changed in July.

Mr. Bayley

I refer the Minister to the letter from Derek Fowler, chairman of the trustees, to the Secretary of State, dated 26 October: I certainly did not envisage the cash payments would cease indefinitely when I signed the memorandum, hence its reference to retiming. If there is any misunderstanding, it is on the part of the Minister. In the memorandum of understanding signed on 20 July, the words agreed with the chairman of the trustees were: The Government remains committed to support payments to certain BR pension funds. In October, it became clear to the trustees that that commitment had been abandoned and that the Government intended to return to their previous plan, outlined in their first consultation document on pensions, to grab the pensioners' cash.

On 15 October, the chairman of the trustees wrote to the Secretary of State saying: the main purpose in writing to you is to record my grave concern, and that of the Trustee Board, at your decision to change the provisions of the Memorandum of Understanding in relation to support payments to certain BR pension funds under the 1980 Act … If payments under the 1980 Act cease and are substituted by a non-marketable Government IOU, the implications for the Fund would be very serious indeed. We calculate that in 10 years time the capitalised Transport Act payments would represent some 25 per cent. of the assets of the closed fund. 10 years later …over 70 per cent. of the assets might be represented … moving close to an unfunded scheme"— such as was first suggested by the Government and which was withdrawn because of the outcry from the pensioners.

Back in the spring, the Government withdrew their cash grant scheme because the pensioners—the people whose money it is—did not want it. Through a process of leakage of funds that the Government currently have an obligation to pay into the scheme, we shall find in 20 years' time that 70 per cent. of the value of a fund has been removed and replaced with worthless pieces of paper with no tradeable value.

The fund's real assets will be progressively replaced by IOUs. They are not cash and cannot be spent by the fund. It would be inflationary for the Government to print £70 million to place in the fund. As the IOUs have no tradeable value, if the pension fund wants in future to invest in works of art, it can hardly go to Sotheby's and say, "We want to buy a Rembrandt, will you accept our IOU?" If it wants to buy property, it cannot go to Jackson, Stops and Staff and say, "We want to buy this industrial estate. We want to buy this mansion. Will you accept our IOU?" If it wanted to invest in the equity market, it could not go to a stockbroker and offer an IOU.

The Government seek to do by the back door that which they sought to do earlier by the front door—remove the fund's assets. Instead of simply grabbing the cash and putting it into the Treasury, the Government intend to dispense with their obligation to fund the scheme to the tune of £70 million a year.

The second development that arises from the debates in another place is the change in the way in which the fund's surplus will be applied. Pensioners currently have a guarantee that their pensions will rise each year by at least the rate of inflation, and they have the opportunity to benefit from any surplus from the scheme. That has been replaced by an inflation guarantee—I acknowledge that —but also by an ability to benefit from a maximum of only 40 per cent. of any surplus.

Earlier, the Secretary of State told the House that the balance of 60 per cent. will remain in the fund, but will it remain as part of the assets that the trustees will control, or will it—as I understand will be the case—fall under the control of a Government-appointed commissar? If so, it will be part not of the pension fund but of a separate, Government-controlled fund.

I would like some of the pensioners to speak for themselves. I represent a large number of British Rail pensioners, and 350 of them wrote to me. Not one was in favour of the Government's proposals. A Mrs. Pratt wrote: I fail to understand the dishonesty of the Treasury, who want to steal our fund to try and get themselves out of the mess they have got themselves into. They seem to have no respect for the elderly, who went without luxuries to pay into the fund. Mr. Waite wrote: How they contemplate such an act and condemn Maxwell for exactly the same behaviour makes one gasp. Mr. Backshall wrote: Comparisons with the morals of the late Mr. Maxwell are hard to resist. Mr. Carey wrote: The sterling work done by the administrators in building up the fund's assets has already benefited British Rail, relieving them of their commitment to contribute to the fund for quite some time …I trust you will do all your best to persuade the Transport Secretary to refrain from his intention to take the funds belonging to the railway staff past and present. These funds were those guaranteed under the 1980 Act, and the Government have an obligation to pay £70 million a year into the scheme as a consequence of the change from an unfunded to a funded scheme. Those are late payments on behalf of people who paid for and accrued their pensions before 1975. For the Government to pay with IOUs is not to meet their obligation to many of my constituents.

It is not good enough. The Government may think that they are winning a great victory tonight by forcing through the Bill and this pension change on a guillotined vote, but it will come back to haunt them at the next election. Rail pensioners will not tolerate their life savings being tampered with by the Government, and the Government will face their Waterloo at the next election because of the way in which they have treated the rail pensioners.

Mr. Alan Williams (Swansea, West)

I shall be very brief.

Ministers' record on pensions has been deplorable and devious. As the other place will confirm, there are lies, damn lies and ministerial memoranda.

What on earth is the value of this so-called memorandum? The Secretary of State tried to argue that it has validity. We all know that it has no validity against statute law, which is what we are dealing with tonight. The terms of the statute are what will be judged in the court.

The IOU, like so many other provisions of the Bill, is yet another expression of the Government's inability to work out what they want to do. This is their latest gimmick. What is the point of the IOU? Does it count against public expenditure for the year when it is given? Is it real? Is it an asset that can be used by the pension fund? Of course not. As my hon. Friend the Member for York (Mr. Bayley) said, assets cannot be bought, or good investments made, with an IOU.

The feature of the pension fund has been the good judgment of its trustees, which has been recognised time and again by the Minister for Public Transport, who has paid tribute to the trustees for the way in which they have managed the money. They cannot manage IOUs. What will be the value of an IOU in 10 or 15 years?

It is not good enough for the Minister to pretend that this spurious memorandum offers any protection. The one common feature of the Bill and of the pension proposals has been the Minister's attempt to take powers that go well beyond any that he should need if his objectives are as modest or as honourable as he has claimed.

For proof, one has only to look at paragraphs 2, 3 and 4 to schedule 10, under which the Secretary of State may amend, may decide who is in or who is out, who contributes, what proportion the employee or employer contributes, what amendments are to be made to the old and new schemes, when the schemes will be wound up and even what proportion of assets will be transferred between an old and a new scheme.

The Minister says that the Government will guarantee the new scheme. What is worrying is that they have control over the amount of assets that can be allocated from the old scheme to the new one because, as guarantor of the new scheme, they have a vested interest in transferring as much as possible. There is a clash of interests.

The Bill offers the Government the unprecedented ability to take private assets from people without proper compensation by offering them IOUs that will have a diminishing value in real terms. What protection is there? The Bill proposes that Ministers will consult. Who can be taken in by any pretence that this Government will consult?

I remember the consultation that took place on my local hospital becoming a trust hospital. The representations were about 9:1 against, and virtually every authority of any importance was opposed to the idea. The Minister involved refused to publish the names of those who were in favour but, at the end of the day, he could say that he had consulted, and the hospital became a trust hospital. Consultation does not mean taking note. It is no good the Minister saying that he wants agreement, because the Bill does not state that he needs agreement; the Bill states only that he needs to consult, after which all he needs is an order.

11 pm

In Committee, I referred to one of the tragedies of any party that has been in office too long. I say this without meaning to be patronising, but there are now too many Conservative Members who have never been in opposition and been kicked around by Ministers. Those hon. Members who entered the House when I did, or shortly afterwards, can look back and see how many affirmative orders have been defeated over the years.

What happens when a Minister introduces such an order and the Whips put the squeeze on their Back Benchers? What has always happened will happen with today's rebellion. Let us also bear it in mind that an order is debated for only one and a half hours, so hardly anyone has the opportunity to participate. In addition, an order cannot be amended—one either accepts it or turns it down.

The Bill gives Ministers the power to do what they like with other people's assets. What would the Conservatives think if a Labour Government told them that they intended to do the same with private pension funds in which their constituents had an interest? We may disagree politically, but that is a genuine question because it could happen, although I would hope that we would not do anything so outrageous. However, let us suppose that we did—how would the Conservatives feel? What reassurance would they find in the unamendable affirmative procedure and a one-and-a-half hour debate? What satisfaction would they be able to give to their constituents? That is how we feel now when talking about the people whose interests we are trying to represent.

Mrs. Dunwoody

One of the most depressing aspects of this utterly depressing Bill is the shiftiness with which the Government have dealt with pensions. I do not think that the Government understand the extent of the outrage felt by railway workers about the Government's behaviour. That outrage is valid among people who have contributed to pension funds all their lives but are suddenly being told that the control of those funds is being transferred from the proper trustees and put in the hands of the Government.

During our consideration of this part of the Bill, Ministers said that the original idea was to have agreement. During the negotiations, however, they came to believe that they did not need agreement after all; they merely needed to consult. I am amazed that the Government think that they can treat the House and our constituents with such contempt.

I have literally hundreds of railway pensioners in my constituency—men and women who, despite very low rates of pay, have contributed to pension schemes all their lives. They believed that their interests would be protected and that the future of the railway industry was such that they would always have the security of knowing that in their old age they would have proper pension provision. They now feel seriously—

Mr. Raymond S. Robertson (Aberdeen, South)

On a point of order, Madam Deputy Speaker. As someone who is still relatively new to the procedure of the House, may I ask whether it is in order for an hon. Member who chaired part of the Committee's proceedings to take part in the debate when the matter comes back to the Floor of the House?

Madam Deputy Speaker (Dame Janet Fookes)

There is no rule on that.

Mrs. Dunwoody

Actually, Madam Deputy Speaker, I have consulted the House authorities, and you may like to know that, in the view of the Chairman of Ways and Means, Lords amendments are not comparable. I chaired one sitting of the Committee, to assist a member of another party who was in a difficult situation. There is no reason why I should have to excuse my behaviour. My constituents require me to speak on their behalf. The intervention by the hon. Member for Aberdeen, South (Mr. Robertson) shows how ashamed Conservative Members are of the Government's behaviour. They do not even dare to listen to Opposition Members making a legitimate case for their pensioners.

The Government would like that case to go by default. They do not want an open discussion; they always want to hide behind semantics and presentation, and to suggest that they are offering genuine guarantees. Tonight, for their own ends, and certainly for their own financial advantage, the Government seek to introduce a scheme which, far from protecting railwaymen, railwaywomen and future railway industry pensioners, puts those people in a less advantageous position and damages their interests.

I believe that the Minister is an honourable man, but I do not think that he realises that many people outside the House are capable of understanding what is happening here. They may not know the difference between an affirmative and a negative procedure, and they may not understand the procedures of the House of Commons or of another place, but they understand something much simpler. They understand that what is important between a Government and the people who vote is trust, faith, understanding, commitment and, above all, the belief that a Government will not seek by some shabby manoeuvre to deprive them of their legitimate rights. People know what the Government are doing, and in due course they will make them pay.

Ms Glenda Jackson

Those who served on the Standing Committee know only too well that the question of what will happen to the British Rail pension fund after privatisation is a nut that the Government have significantly failed to crack time and again. Either they had no proposals prepared, or those that they presented were totally unacceptable not only to the Committee but to the pensioners and to the trustees of the pension fund.

The Secretary of State opened our debate on pensions tonight by saying yet again that he wanted to clarify the position, to calm fears and to allay suspicions. The right hon. Gentleman said that he wished to make four points, although if my memory serves me well he managed to cover only three of those subjects: assets, solvency and what a good deal the Government were giving BR pensioners—as though the pension fund were his to give.

With regard to the assets, the one chink of light and the one way forward for pensioners seemed to come from the memorandum of understanding signed by the Minister—on behalf of the Government, I presume—and by the chairman of the British Rail Pension Trustee Company Ltd. and by a board member. That document was signed on 20 July, but on 26 October the chairman of the trustees wrote to the Minister expressing grave concern about changes that he thought were taking place, although he had believed the memorandum to be binding on all parties.

In one letter, the chairman deals with the issue of assets. He says: The indefinite cessation of cash payments under the 1980 Act will accelerate the realisation of marketable assets to pay pensions. It is only on those assets that the Trustees can earn real increases. As those assets are realised the non-marketable Government IOU will represent a larger proportion of total scheme assets, thus diminishing the scope for real increases and disadvantaging pensioners. In a letter of 26 October to the Secretary of State, the chairman of the British Rail Pension Trustee Company Ltd. touches on the issue of solvency, which the Secretary of State assured us tonight is entirely safe because it is in the Government's hands. He says: I am sufficiently experienced in public expenditure matters to know that Government guarantees cannot be given lightly and without sensible controls which protect taxpayers' interests. Those requirements were recognised in the Memorandum of Understanding. What I had not foreseen when I signed the Memorandum was that the Secretary of State would be given powers to virtually take over the fund if the solvency guarantee were to be invoked. On the issue of the good deal, the chairman, in another letter to the Secretary of State, says: your proposals, as presently stated, will effectively eliminate any possibility of actuarial surpluses arising. This is contrary to one of the basic principles underlying the Memorandum of Understanding. So a man whose entire professional life has been dedicated to the management of pensions funds and who has written to the Secretary of State about the assertions that he made to the House and the country tonight—that the assets of the pension fund are safe, the solvency of the pension fund is safe and pensioners will continue to get a good deal from the fund—believes that the Secretary of State is being so èconomical with the truth that he 'puts Scrooge in second place.

One of the points made by the Minister tonight was that there could be no power of veto over Government expenditure. Clearly, that point had occurred to the trustees in the light of the changes that the Government were making to what they had supposed was a binding agreement—the memorandum of understanding.

The British Rail Pension Trustee Company Ltd. sought legal advice, which I quote: the new Sections 52B to 52D give to the Government a far greater degree of flexibility than is envisaged in the Memorandum …These powers are very broad". If the powers are taken out of the hands of trustees, they will be exercised to the detriment of scheme members. The Government's control over public expenditure only exists because Parliament has given it the necessary powers through legislation. Parliament can therefore impose constraints on those powers. If only the Government had given Parliament sufficient time to debate that issue.

The legal adviser to the British Rail Pension Trustee Company Ltd. says that there are precedents which discount the Government's argument that they would be handing over the power of veto to the trustees: Section 33(3) of the British Telecommunications Act 1981 provides a precedent for the imposition of duties on the Secretary of State in making orders. We believe that there may be numerous other examples on the statute book". I do not think that anyone can argue that the opinions and the evidence that I have presented in this debate come from a party political stance. As hon. Members know, I have the great honour to be a Member sponsored by the Associated Society of Locomotive Engineers and Firemen [Interruption.] It never fails to amaze me that I continue to give Tory Members the benefit of the doubt that they can read and hear. This is by no means new information, yet every time I say it, certain Tory Members react as though it is the first time in their lives that it has been presented to them.

My constituents also include British Rail pensioners and their dependents. They believe that, in this as in so many issues, the Government have shown a marked lack of trust for, and sense of duty to, pensioners.

We know that the Government hold pensioners in fairly low esteem. They intend to introduce a whole range of measures that will impinge on pensioners' life styles with great cruelty. In this regard, however, I feel that the Government have absolutely no right to any respect. As Opposition Members told the Secretary of State earlier, the way in which the Government have attempted to take the British Rail pension fund away from the people to whom it most justifiably belongs in order to buy their way out of their economic incompetence is disgraceful, and they should resign.

11.15 pm

Mr. Heppell

I shall not speak for long, because I spoke for some time in the guillotine debate. However, I should like some guarantees from the Secretary of State.

I take great exception to being patronised by the Secretary of State about what he has given me. The fact that I will get an inflation-proof pension, the fact that I shall be able to share in some of the surpluses and the fact that I now have a pension that guarantees solvency do not make me feel a great deal better, as I enjoyed all those benefits before. I had no guarantee, but I had solvency.

I had an inflation-proof pension, with benefits from the surpluses. Indeed, for some of the last few years of my time on the railways I paid half contributions, because of the contributions holiday for both my employer and myself: the surpluses were that healthy. The scheme was completely solvent: no one had any worries about its solvency until the Government introduced their privatisation plans.

I will not thank the Secretary of State for his guarantee of solvency. I will not say thank you for something that I had in the first place, which the Government then took away from me; nor will I say thank you to the Government for giving me interest on money that they borrowed from me.

Let me quote from a statement made by the Minister on 22 April. It is similar to what others have quoted. There is no doubt in my mind that the Secretary of State made a promise—a promise like many others that I have been given by him and the Minister about my pension. The Minister said: The Bill does not yet contain amendments to the Transport Act 1980. These are likely to be necessary in order to continue the payment of Government contributions to successor schemes—a commitment the Government have already given. These amendments will be brought forward at a later stage."—[Official Report, Standing Committee B; 22 April 1993; c. 1296.] There is nothing ambiguous about that. The Government are going to continue to pay their contributions to the scheme. And so they should: a promise was written into the Transport Act 1980 that, because the Government had underfunded my pension scheme, they would guarantee contributions each year.

At about 8.30 pm on 25 March 1980, the Parliamentary Under-Secretary of State—the right hon. and learned Member for Rushcliffe (Mr. Clarke), now Chancellor of the Exchequer—made that promise. It may be necessary to bring him to the House to explain to the Secretary of State and the Minister what that promise meant. They are seeking to welsh on it—to welsh on me, and on other pensioners. I do not think that that should be allowed. There is no reason why those contributions should be removed.

However, there is a memorandum of understanding. It seems that the Secretary of State's understanding is different from that of the trustees. I do not like that memorandum and would criticise my trustees for signing it. I do not see why I should be obliged to lend the Government money from my pension fund. The trustees are obviously much more generous than me, recognise the difficulties of the Government, the Treasury and the Chancellor of the Exchequer, and have decided that, instead of taking the contributions, they will lend them to the Government, who can have them on loan.

I should be happy if it were merely a loan, but I have no doubt that it is not a loan. If I am wrong, I am happy to give way to the Minister or the Secretary of State so that I may be told when the loan will be paid back. A loan involves lending money and, at some stage, receiving it back. However, I have heard nothing from the Government to tell me when I will get my money back. One issue that is worrying the trustees now is the fact that the Government sent out a letter to their Back Benchers to placate them and assure them that the trustees were happy.

The trustees have written to say that the letter is wrong. In their letter to Back Benchers, the Government said: we all acknowledge that whilst the liability to make payments under the Transport Act 1980 would remain, actual cash drawings under this arrangement should be made only when the Fund needed the cash payment. Who decides when that payment is needed? That was why the clause had to be included in the memorandum. The trustees recognised the importance of the clause because the loan could be made and the timetable for repayment could be made only with the agreement of the trustees. The Government seek to remove the undertaking that they gave to the trustees. I understand why the trustees are angry.

As part of their privatisation process, the Government wanted to take part of my pension. They wanted to take the surpluses in my pension because they thought that I was receiving too much. In Committee, some Conservative Members asked me what I was moaning about, as I received a good pension. I do not think that I should receive merely a good pension; I think that I should have the best pension that those funds can provide. Every other pensioner is entitled to that. The Government have no right to take part of my pension to stick it in the Treasury because they think my pension is too good—that is not on.

The Government have made it clear, first with their two options and now by their actions, that their intention throughout was to take my money. The biggest irony of the Bill is that, while the Government talk about competition and privatising, they have nationalised my pension.

Mr. Patrick Cormack (Staffordshire, South)

I intervene for only one reason: out in the country, tens of thousands of pensioners and potential pensioners are deeply worried. Although many of the issues raised were entirely legitimate and I would like to hear the answers to some of the questions asked by the hon. Member for Hampstead and Highgate (Ms Jackson), the pensioners do not have to worry about the fundamental facts. Their pension is protected, they will receive at least as much as they have always expected or hoped to receive, and nobody is bent on filching anything from them.

If the individual pensions to be received by my constituents and those of other hon. Members were to be tampered with in any way, does any hon. Member believe that a Government of any persuasion would get away with it? Of course they would not.

Ms Hilary Armstrong (Durham, North-West)

Will the hon. Gentleman give way?

Mr. Cormack

The hon. Lady, who seeks to intervene and to whom I shall give way in a moment, knows that as well as I do.

Trust has been talked about in the Chamber this evening. There are plenty of hon. Members in the Chamber who always put party interest way below any other. If any Government of any party sought to engage in the sort of pilfering exercise that has been talked of, they would not get away with it. I do not believe for a moment that my right hon. and hon. Friends would ever engage in such an exercise. They know very well that there would be sufficient on the Conservative Benches to stop them if they tried.

Mr. Prescott

The Department of Transport has already been involved in the very process of raiding pension funds. When the National Bus Company was privatised, the pension fund was broken up in a similar manner and the Department made it clear in evidence to the Public Accounts Committee that the sale price of £200 million was made up of about £150 million taken from the pension fund, a surplus which went directly to the Treasury. The Government have already done it. Perhaps the hon. Gentleman was not watching. He could have prevented it but it did happen.

Mr. Cormack

But the hon. Gentleman knows as well as I do that no pensioner has suffered as a result of—

Mr. Prescott

They did.

Mr. Cormack

No, I do not think that that is the case. No individual pensioner has suffered. The point that I am seeking to make can stand any challenge. I of course want to hear what my right hon. Friend the Minister will say when he replies to the debate, but I repeat that no Government, Conservative or Labour, would get away with raiding the individual pensions of any of our constituents, and we do those constituents a disservice by fuelling their anxieties at a time like this.

Mr. John Denham (Southampton, Itchen)

The hon. Member for Staffordshire, South (Mr. Cormack) has put one version of the history of the past year's debate on the pension scheme. That is the version that the Government would like us to accept; the version that says that a valiant band of honest men and women have been struggling against great obstacles, legal problems, Inland Revenue difficulties and parliamentary procedures in order to guarantee the future interests of British Rail pensioners.

An alternative view of the history of the past 12 months' debate is that the Government's main objective has been to confuse and to defuse the anger that arose among British Rail pensioners as a result of this move, while at the same time achieving their fundamental objective—a devalued pension scheme which will pay less than would have been the case under the existing scheme, and which brings financial benefits to the Treasury. I believe that time will show that that is the correct view of the past 12 months.

By the time that the Bill reached Committee, I had received, either directly or through my hon. Friend the Member for Kingston upon Hull, East (Mr. Prescott), more than 800 letters from railway pensioners in the Southampton area expressing concern about the Government's proposal and supporting the continuation of the existing scheme. That concern continued to mount during the summer months, until the memorandum of understanding was agreed between the Government and the British Rail trustees.

The memorandum of understanding was given wide publicity. I seem to recall that a letter was sent to every individual member of the fund from the trustees outlining its main terms. When that letter was received, the anger collapsed and the momentum of the campaign against the scheme was diffused.

Although those who looked at the scheme closely knew that the scheme on offer was less good than the maintenance of an industry-wide scheme which new entrants to the railway industry would continue to join, they did have a letter from the chairman of the trustees of the British Rail pension fund saying that a satisfactory deal had been reached.

Those pensioners and tens of thousands of others thought that that agreement with the Government was the guarantee. They thought that the agreement was the result of the letters that they had written to their Members of Parliament, and that it would secure their futures in the pension fund. So in July the Government had achieved their primary objective of the past 12 months, which was to stop the wave of anger throughout the country by leading pensioners to believe that their futures were secure.

11.30 pm

That explains the tone of the correspondence between the chairman of the pension trustees and the Secretary of State, to which several hon. Members have referred this evening. In a letter to the Secretary of State dated 26 October, Derek Fowler said: I saw the Memorandum of Understanding as a milestone on the way towards securing Government objectives to secure BR Pensions. The steady erosion of what I thought had been agreed seems to justify the sceptical approach taken by many of my colleagues and others to the Memorandum". It is not for me to put words into the mouth of the chairman of the pension fund trustees, but it seems to me that, in the publicity surrounding the memorandum of understanding in July, the chairman of the trustees was asked to put his good name and reputation to what has since been used cynically by the Government to defuse pensioner and public opposition to the move. I regard that action as unjustified.

There are major problems with what is now proposed. They have been highlighted by other hon. Members. If IOUs are substituted for cash payments, as the chairman of the fund points out, that will accelerate the realisation of marketable assets to pay pensions. It is only on those assets that the Trustees can earn real increases. The Bill provides no protection which would prevent the timing of the payments being so phased or delayed as to force the fund to realise marketable assets faster than would have occurred under the existing arrangements.

Every time that the trustees are forced to sell investments which they currently hold, a transfer of the assets of the fund has been achieved, to the saving and the benefit of the Treasury.

Mr. Nigel Spearing (Newham, South)

Does not the whole affair have the fingerprints of the Treasury all over it? The hapless Ministers are in the hands of the Treasury. If the principles of the hon. Member for Staffordshire, South (Mr. Cormack) are to be put into practice—we all wish they would be—surely the Government must come back with another Bill to return to the status quo. That is the only way in which the criteria of the hon. Gentleman can be observed.

Mr. Denham

I agree with my hon. Friend. He refers to Conservative Members. To those Conservative Members who are feeling secure about their pensioners because they have received a briefing note or letter from the Secretary of State, I point out that in the same letter to the Secretary of State, Mr. Derek Fowler said: The letter to your colleagues dated 22 October heightens my concern. That is what the chairman of the trustees said about the party political propaganda which has been circulated to Conservative Members and is undoubtedly intended for them to reproduce and send to their constituents who are British Rail pensioners. I hope that any right hon. or hon. Member who intends to do that will ensure that he includes the comments of the chairman of the trustees when he writes to his constituents. To do less would not be entirely honest.

At the outset of this exercise, the Government proposed nicking the assets of the pension fund in one go. That gave rise to a howl of outrage, so the Government said that they would not. We knew that they would. They knew that we knew that they would. They knew that we did not quite know how they would do it, so they continued to say that they would not, but they continued to know that they would. Now they are, and they know that they are, and we know that they know that they are, but still they say that they are not. It is clever, but it is cynical and wrong, and for hundreds of thousands of pensioners, it is robbery.

Mr. Stevenson

Having sat through most of the two-day debate without contributing to it, I hesitated to do so at this late hour, but was prompted to intervene by the speech of the hon. Member for Staffordshire, South (Mr. Cormack).

Many of my hon. Friends, and some Conservative Members, have said that the Government do not understand what is happening. Having listened to the debate, I believe that they fully understand what is happening. They know exactly what they are doing. They know the principles that they are establishing in this rotten Bill. If there is a pension fund that the Treasury can get its hands on, the Government will establish the principles, under whatever comouflage or subterfuge afforded by their amendments, to allow that to happen legitimately. My hon. Friends have established that beyond any doubt. The giggling and smiling that I have witnessed from some Tory Members will not camouflage that.

The Secretary of State said that he wanted to clarify the apparent contradiction between the contents of the memorandum of understanding, which was signed in July, and the Government's amendment, which changes the word "agreement" to "consultation". I know that many Conservative Members think about such matters carefully, as the hon. Member for Staffordshire, South said. There is a great deal of difference between the two words. I do not want to rehearse the points made by my hon. Friends, who have adequately and starkly shown the difference between the two.

In attempting to clarify the situation, the Secretary of State caused more confusion. Which is it to be? Is it to be agreement or consultation? He said that there would be negotiations between him and the trustees of the fund, and if they are to be based on the memorandum of understanding, in all good faith—I ask Tory Members to think about that—they will have to be based on agreement. The tragic irony is that, if Tory Members troop through the Lobby in favour of the amendment, they will break faith with the memorandum of understanding. They simply cannot have it both ways. That is a fundamental principle.

Before the Division is called, the House will need a clear statement from the Secretary of State on which word is right. Is it to be the memorandum of understanding or the amendment? Will it be agreement or consultation? I see the hon. Member for Langbaurgh (Mr. Bates) shake his head. I recognise that I am not a public school person, but the thousands of pensioners who will be listening to the debate with great interest will understand clearly that, no matter how you try to camouflage it, you cannot have it both ways. It must be agreement or consultation.

If Conservative Members support the amendment in the Lobby they will have broken faith for party and trust.

Madam Deputy Speaker

Order. I remind the hon. Member that he should be addressing the Chair.

Mr. Stevenson

I apologise, Madam Deputy Speaker. I am relatively new to the House and am grateful for your guidance.

The comments of the hon. Member for Staffordshire, South touched on the issue of trust and faith. In response to an intervention by my hon. Friend the Member for Kingston upon Hull, East (Mr. Prescott), he mentioned the National Bus Company employees. My hon. Friends the Members for West Bromwich, East (Mr. Snape) and for Nottingham, East (Mr. Heppell) said that they were British Rail pensioners. I suspect that I am one of the few Members who used to belong to the Bus Employee Superanuation Trust, to which thousands of bus workers contributed year after year. When the Government privatised it, they gave £150 million of our money to the Treasury, which reduced my entitlement. The Bus Employee Superannuation Trust is now all but destroyed as a direct result of legislation supported by the hon. Member for Staffordshire, South.

If hon. Members want evidence, they need not wait for the film but can read the book. It is all there for them to see. The case has unquestionably been made that the Government intend to act in the same way again, and I urge all Conservative Members with a conscience to support us in the Lobby.

Mr. Wilson

It is fitting, and a metaphor of our proceedings, that we should end tonight's debate with a contrast between fantasy and realism. The hon. Member for Staffordshire, South (Mr. Cormack) made a characteristic, Vicar-of-Bray contribution, in which he tried to show the world that all was well. But I fear that anyone who is counting on the happy consensus which he envisaged, based on Conservative Members suppressing party loyalty while they safeguard the interests of pension funds and the national good, will be deeply disillusioned.

As my hon. Friend the Member for Stoke-on-Trent (Mr. Stevenson) pointed out, and as the hon. Member for Staffordshire, South clearly did not understand, we have seen this scenario before. He told us that Conservative Members would put aside party loyalties—all the matters which we pray about—and carefully guard pension funds, and that no Government of any complexion would lay their hands on a pension fund, heaven forfend. But it happened with the National Bus Company. The gains to the Treasury from the net receipts from winding up pension funds amounted to £120 million. And one of the people directly involved in it has cast some realism on the debate.

However, tonight we are discussing not £120 million but big bucks. We are discussing money that makes a serious dent in the public sector borrowing requirement. We are discussing the scale of precedent that could be applied to the coal pension fund, the Post Office pension fund and, I suppose, every other pension fund on which the Government have set their eyes.

If we are waiting for the hon. Member for Staffordshire, South and his men of no fixed allegiance to pass among us ensuring that none of that ill is visited upon society, few of the thousands of pensioners who have written to hon. Members on both sides of the House will regard that as much of a guarantee. They would prefer a guarantee in the Bill to a verbal guarantee by the hon. Member for Staffordshire, South.

Ministers have conspicuously refused to give a guarantee in the Bill at every stage of the proceedings because they intend to get the Treasury's hands on the surplus of the British Rail pension fund. The mystery may never be solved. We may never know the answer to my earlier question about which came first to these malevolent minds. Was it rail privatisation or getting their hands on the pension fund? Did the Government think of rail privatisation and then realise what they could do with the pension fund? Rail privatisation is a disruption of our national railway system, a threat to the whole network through privatisation and fragmentation. Is that the by-product of the grand scheme of getting their hands on the pension funds? That is the $64,000 question, or perhaps it is the £4 billion question.

11.45 pm

The only reason for the fear in the minds of pensioners about what is being done is the Bill to privatise British Rail. If there were no Bill to fragment BR, there would be no insecurity in the minds of railway pensioners. Everything that has been visited upon those pensioners over the past few months is a by-product of the Bill. The responsibility for that uncertainty and concern, which are manifested in the correspondence, demonstrations and petitions, rests with the Government because of what they have set about doing to the railways.

The Government could have set about privatising the railways and still maintained a single pension fund. That could have been done if it were not the Government's intention to get this vast sum for the Treasury. Their only reason for fragmentation is to serve their wider political agenda.

This document in my hand will haunt Ministers and Conservative Members who support the amendment. It is the letter from the chairman of the British Rail Pension Trustee Company Ltd. What I and other hon. Members say is of limited relevance, but this letter is an indictment, because it charges the Government with cheating, giving false guarantees and reneging. With a bit of luck in the other place, the House might have to return to these matters tomorrow. I shall read the indictment. It states: I very much regret the need to have written to you three times in less than three weeks on fundamental differences of view between the Government and the British Rail Trustees. I saw the Memorandum of Understanding as a milestone on the way towards securing Government objectives to secure BR pensions. The steady erosion of what I thought had been agreed seems to justify the sceptical approach taken by many of my colleagues and others to that Memorandum. In order to win the vote in the Lords, the man who was prepared to give Ministers the benefit of the doubt while his colleagues were not, said less than a week ago, on 26 October, "I was wrong and they were right." That is an indictment of Ministers and we shall pursue this issue at every stage.

We hope that hon. Members such as the hon. Member for Staffordshire, South will remember this night and will not say in three or four years, "We are your guardians." Now is the time to be guardians, and if they fail in that duty no pension fund will be safe, because this is the greatest potential robbery in the history of pension funds. The Members who support the Government in the Lobby will bear a heavy responsibility.

Mr. Freeman

The performance by the hon. Member for Cunninghame, North (Mr. Wilson) was dramatic, but it was at variance with the facts. [Interruption.] The hon. Gentleman spoke about the fear in the minds of pensioners. The Opposition, not the Bill, have put that fear there. I shall deal with the six substantive points raised in the debate, because I appreciate that the matter is likely to go to the other place and it is important that the facts are on the record. I agree with the hon. Member for Crewe and Nantwich (Mrs. Dunwoody) that this is a sensitive subject for all pensioners. That is why it should be dealt with properly, soberly and rationally, so that we do not incite unnecessary fears in the minds of pensioners.

When the Bill left Committee, we were not speaking about a state guarantee for the pension fund. We were talking about a closed fund for the pensioners—part of the joint industry scheme that had its own assets and trustees. It was at the request of the trustees; it was not my right hon. Friend the Secretary of State for Transport who summoned them. They came to the Government and said, "We are not happy with the Bill as it came out of the Standing Committee; we want a state guarantee for the index-linked pensions." That was not part of what we discussed in the Standing Committee and that changed circumstances entirely.

Does the hon. Gentleman not realise that a state guarantee for index-linked pensions is of great significance to the public sector? Who has to honour that commitment? It is the Treasury.

Mr. Prescott

The Treasury guaranteed it in the first place.

Mr. Freeman

The hon. Gentleman is quite wrong; the pensioners were not guaranteed by the state. There was no Government guarantee for the pensioners.

Both Opposition Front-Bench Members raised a number of issues. Let us be clear about the answers. First, we are talking about payments to the closed funds and not to the other open funds; therefore, we are talking not about £70 or £80 million but about £50 million. The cash payments will continue to be made to the other funds that are not subject to a state guarantee.

Secondly, we have made it quite clear that the liabilities that continue to accrue under the Transport Act 1980 will be capitalised at the point at which the new scheme is created. The present value of the scheme of future payments will be calculated not by the Secretary of State for Transport, but by the actuaries. That will come to a substantial sum of several hundred million pounds.

Mr. Prescott

When?

Mr. Freeman

That will be calculated when the fund is set up on 1 October 1994. That is the intention. That asset will be on the balance sheet of the pension fund. I accept that we have to ensure that it is properly valued and not worthless; that it has the value that the actuaries put on it for the purposes of calculating the surplus in the pension funds which, up to a certain proportion, can be distributed to the pensioners.

Thirdly, it was agreed by the trustees—the hon. Member for Kingston upon Hull, East (Mr. Prescott) seeks to divide the chairman of the trustees from the others. All the trustees agreed that the memorandum of understanding signed by the chairman was right and proper. They gave him their support and it was quite clear in the memorandum of understanding that, in return for the state guarantee on index-linked pensions, there should be payments from the Government under their accruing liabilities only when there was proven need.

The hon. Gentleman asked who is going to establish when that need arises. The answer is that the actuaries have to value the fund. They measure the assets and liabilities every three years. It is not my right hon. Friend the Secretary of State; it is the actuaries.

Fourthly, I look forward to a resumption of discussions as soon as possible in which we will seek to reach agreement with the trustees on the scheduling of any payments that may be made under the 1980 Act, irrespective of need. The trustees want not only cash payment when there is need, but specific maturities of the amount that has been capitalised and put on the balance sheet.

My right hon. Friend the Secretay of State and I will seek to reach agreement with the trustees not only about the scheduling of the payments but about the specific interest rate that is to apply. I know that we will be able to reach agreement and, as my right hon. Friend has said in any case we have to lay before both Houses orders which are a direct result of those negotiations.

Fifthly, the hon. Member for Cunninghame, North talked about the proportion of the fund that these capitalised assets, the accrued liabilities being paid by the Government, accruing from the Government under the 1980 Transport Act might represent of the fund. The hon. Gentleman quoted a example of 70 per cent. We do not recognise that figure; the actuarial advice to the Government is that the proportion will be closer to 20 per cent.—a normal proportion of any pension fund represented by gilt-edged securities.

The hon. Gentleman also raised the issue of the 60 per cent. of the fund—[Interruption.] Of course it is true. That will be retained in the fund.

In any pension fund, and certainly the BR pension fund in the past, the 60 per cent. that was not distributed to the pensioners, who usually had 40 per cent. of the benefit of any surplus, went back to the employees and the employer. It left the fund and went to British Rail. The hon. Member for Nottingham, East (Mr. Heppell), when he was a member of the Staff of British Rail, shared in a contributions holiday. That is an example of where the 60 per cent. went. We are now saying that the 60 per cent. will stay in the fund.

The hon. Member for Cunninghame, North said that the pensions surplus was stolen from the National Bus scheme. However, that was a balance-of-costs scheme, so—unlike BR—it was not entitled to the surplus. That is the difference. The hon. Gentleman's charge was completely out of order.

Mr. Prescott

In view of the time, I thank the Minister for giving way. He gave the impression that he wanted to get the facts straight for the benefit of the other place. Derek Fowler, chairman of the trustees, wrote to the Secretary of State saying: I certainly did not envisage the cash payments would cease indefinitely when I signed the memorandum, hence its reference to the retiming. That is contrary to what the Minister has just told us.

Mr. Freeman

It is not contrary—[Interruption.] It is not. We have made it quite plain .that we are not talking about an indefinite cessation of payments. I explained that a few minutes ago, and I repeat it now.

We are grateful to my hon. Friend the Member for Staffordshire, South (Mr. Cormack) for what he said. He was right to say that the pensioners have not only a state guarantee of index-linked pensions but a share in the surplus. They have a separate, discrete pension fund, managed by trustees under independent management. That is an excellent deal for the pensioners, and I agree with my hon. Friend that it would be wrong for Ministers in any way to undermine that.

Ministers in the Department of Transport, led by my right hon. Friend, will honour the commitment to reach agreement with the trustees and to come back to the House with orders that will entirely discharge those responsibilities. I commend the motion to the House.

Question put, That this House doth disagree with the Lords in the said amendment:—

The House divided: Ayes 316, Noes 284.

Division No. 383]	[11.57 pm
AYES
Ainsworth, Peter (East Surrey)	Douglas-Hamilton, Lord James
Aitken, Jonathan	Dover, Den
Alexander, Richard	Duncan, Alan
Alison, Rt Hon Michael (Selby)	Duncan-Smith, Iain
Allason, Rupert (Torbay)	Dunn, Bob
Amess, David	Durant, Sir Anthony
Ancram, Michael	Dykes, Hugh
Arbuthnot, James	Elletson, Harold
Arnold, Jacques (Gravesham)	Evans, David (Welwyn Hatfield)
Arnold, Sir Thomas (Hazel Grv)	Evans, Jonathan (Brecon)
Ashby, David	Evans, Nigel (Ribble Valley)
Aspinwall, Jack	Evans, Roger (Monmouth)
Atkins, Robert	Evennett, David
Atkinson, David (Bour'mouth E)	Faber, David
Atkinson, Peter (Hexham)	Fabricant, Michael
Baker, Rt Hon K. (Mole Valley)	Fairbairn, Sir Nicholas
Baker, Nicholas (Dorset North)	Fenner, Dame Peggy
Baldry, Tony	Field, Barry (Isle of Wight)
Banks, Matthew (Southport)	Fishburn, Dudley
Bates, Michael	Forman, Nigel
Batiste, Spencer	Forsyth, Michael (Stirling)
Beggs, Roy	Forsythe, Clifford (Antrim S)
Bellingham, Henry	Forth, Eric
Bendall, Vivian	Fowler, Rt Hon Sir Norman
Beresford, Sir Paul	Fox, Dr Liam (Woodspring)
Biffen, Rt Hon John	Fox, Sir Marcus (Shipley)
Blackburn, Dr John G.	Freeman, Rt Hon Roger
Body, Sir Richard	French, Douglas
Bonsor, Sir Nicholas	Fry, Peter
Booth, Hartley	Gale, Roger
Boswell, Tim	Gallie, Phil
Bottomley, Peter (Eltham)	Gardiner, Sir George
Bottomley, Rt Hon Virginia	Garel-Jones, Rt Hon Tristan
Bowden, Andrew	Garnier, Edward
Bowis, John	Gill, Christopher
Boyson, Rt Hon Sir Rhodes	Gillan, Cheryl
Brandreth, Gyles	Goodlad, Rt Hon Alastair
Brazier, Julian	Goodson-Wickes, Dr Charles
Bright, Graham	Gorman, Mrs Teresa
Brooke, Rt Hon Peter	Gorst, John
Brown, M. (Brigg & Cl'thorpes)	Grant, Sir A. (Cambs SW)
Browning, Mrs. Angela	Greenway, Harry (Ealing N)
Bruce, Ian (S Dorset)	Greenway, John (Ryedale)
Budgen, Nicholas	Griffiths, Peter (Portsmouth, N)
Burns, Simon	Grylls, Sir Michael
Burt, Alistair	Gummer, Rt Hon John Selwyn
Butcher, John	Hague, William
Butler, Peter	Hamilton, Rt Hon Archie (Epsom)
Carlisle, John (Luton North)	Hamilton, Neil (Tatton)
Carlisle, Kenneth (Lincoln)	Hanley, Jeremy
Carrington, Matthew	Hannam, Sir John
Carttiss, Michael	Hargreaves, Andrew
Cash, William	Harris, David
Channon, Rt Hon Paul	Haselhurst, Alan
Chapman, Sydney	Hawkins, Nick
Churchill, Mr	Hawksley, Warren
Clappison, James	Hayes, Jerry
Clarke, Rt Hon Kenneth (Ruclif)	Heald, Oliver
Clifton-Brown, Geoffrey	Heathcoat-Amory, David
Coe, Sebastian	Hendry, Charles
Colvin, Michael	Higgins, Rt Hon Sir Terence L.
Congdon, David	Hill, James (Southampton Test)
Conway, Derek	Hogg, Rt Hon Douglas (G'tham)
Coombs, Anthony (Wyre For'st)	Horam, John
Coombs, Simon (Swindon)	Hordern, Rt Hon Sir Peter
Cormack, Patrick	Howard, Rt Hon Michael
Couchman, James	Howarth, Alan (Strat'rd-on-A)
Cran. James	Howell, Rt Hon David (G'dford)
Currie, Mrs Edwina (S D'by'ire)	Howell, Sir Ralph (N Norfolk)
Curry, David (Skipton & Ripon)	Hughes Robert G. (Harrow W)
Davies, Quentin (Stamford)	Hunt, Rt Hon David (Wirral W)
Davis, David (Boothferry)	Hunt, Sir John (Ravensbourne)
Day, Stephen	Hunter, Andrew
Deva, Nirj Joseph	Hurd, Rt Hon Douglas
Devlin, Tim	Jack, Michael
Dicks, Terry	Jackson, Robert (Wantage)
Dorrell, Stephen	Jenkin, Bernard

Jessel, Toby	Redwood, Rt Hon John
Johnson Smith, Sir Geoffrey	Renton, Rt Hon Tim
Jones, Gwilym (Cardiff N)	Richards, Rod
Jones, Robert B. (W Hertfdshr)	Riddick, Graham
Jopling, Rt Hon Michael	Rifkind, Rt Hon. Malcolm
Kellett-Bowman, Dame Elaine	Robathan, Andrew
Key, Robert	Roberts, Rt Hon Sir Wyn
Kilfedder, Sir James	Robertson, Raymond (Ab'd'n S)
King, Rt Hon Tom	Robinson, Mark (Somerton)
Knapman, Roger	Roe, Mrs Marion (Broxbourne)
Knight, Mrs Angela (Erawash)	Ross, William (E Londonderry)
Knight, Greg (Derby N)	Rowe, Andrew (Mid Kent)
Knight, Dame Jill (Bifm E'st'n)	Rumbold, Rt Hon Dame Angela
Knox, Sir David	Ryder, Rt Hon Richard
Kynoch, George (Kincardine)	Sackville, Tom
Lait, Mrs Jacqui	Sainsbury, Rt Hon Tim
Lamont, Rt Hon Norman	Scott, Rt Hon Nicholas
Lang, Rt Hon Ian	Shaw, David (Dover)
Lawrence, Sir Ivan	Shaw, Sir Giles (Pudsey)
Legg, Barry	Shephard, Rt Hon Gillian
Leigh, Edward	Shepherd, Colin (Hereford)
Lennox-Boyd, Mark	Shersby, Michael
Lester, Jim (Broxtowe)	Sims, Roger
Lidington, David	Skeet, Sir Trevor
Lightbown, David	Smith, Sir Dudley (Warwick)
Lilley, Rt Hon Peter	Smith, Tim (Beaconsfield)
Lloyd, Peter (Fareham)	Soames, Nicholas
Lord, Michael	Spencer, Sir Derek
Luff, Peter	Spicer, Sir James (W Dorset)
Lyell, Rt Hon Sir Nicholas	Spicer, Michael (S Worcs)
MacGregor, Rt Hon John	Spink, Dr Robert
MacKay, Andrew	Spring, Richard
Maclean, David	Sproat, Iain
McLoughlin, Patrick	Squire, Robin (Hornchurch)
McNair-Wilson, Sir Patrick	Stanley, Rt Hon Sir John
Madel, David	Steen, Anthony
Maitland, Lady Olga	Stephen, Michael
Malone, Gerald	Stern, Michael
Mans, Keith	Stewart, Allan
Marland, Paul	Streeter, Gary
Marlow, Tony	Sumberg, David
Marshall, John (Hendon S)	Sweeney, Walter
Marshall, Sir Michael (Arundel)	Sykes, John
Martin, David (Portsmouth S)	Tapsell, Sir Peter
Mates, Michael	Taylor, Ian (Esher)
Mawhinney, Dr Brian	Taylor, John M. (Solihull)
Mayhew, Rt Hon Sir Patrick	Taylor, Sir Teddy (Southend, E)
Mellor, Rt Hon David	Temple-Morris, Peter
Merchant, Piers	Thomason, Roy
Milligan, Stephen	Thompson, Sir Donald (C'er V)
Mills, Iain	Thompson, Patrick (Norwich N)
Mitchell, Sir David (Hants NW)	Thornton, Sir Malcolm
Moate, Sir Roger	Thurnham, Peter
Molyneaux, Rt Hon James	Townend, John (Bridlington)
Monro, Sir Hector	Townsend, Cyril D. (Bexl'yh'th)
Montgomery, Sir Fergus	Tracey, Richard
Moss, Malcolm	Tredinnick, David
Needham, Richard	Trend, Michael
Nelson, Anthony	Trotter, Neville
Neubert, Sir Michael	Twinn, Dr Ian
Newton, Rt Hon Tony	Vaughan, Sir Gerard
Nicholls, Patrick	Viggers, Peter
Nicholson, David (Taunton)	Waldegrave, Rt Hon William
Nicholson, Emma (Devon West)	Walker, A. Cecil (Belfast N)
Norris, Steve	Walker, Bill (N Tayside)
Onslow, Rt Hon Sir Cranley	Waller, Gary
Oppenheim, Phillip	Ward, John
Ottaway, Richard	Wardle, Charles (Bexhill)
Page, Richard	Waterson, Nigel
Paice, James	Watts, John
Patnick, Irvine	Wells, Bowen
Patten, Rt Hon John	Whitney, Ray
Pattie, Rt Hon Sir Geoffrey	Whittingdale, John
Pawsey, James	Widdecombe, Ann
Peacock, Mrs Elizabeth	Wiggin, Sir Jerry
Pickles, Eric	Wilkinson, John
Porter, David (Waveney)	Willetts, David
Portillo, Rt Hon Michael	Wilshire, David
Powell, William (Corby)	Wolfson, Mark
Rathbone, Tim	Wood, Timothy

Yeo, Tim	Tellers for the Ayes:
Young, Rt Hon Sir George	Mr. Timothy Kirkhope and
	Mr. Andrew Mitchell.
NOES
Abbott, Ms Diane	Dobson, Frank
Adams, Mrs Irene	Donohoe, Brian H.
Ainger, Nick	Dowd, Jim
Ainsworth, Robert (Cov'try NE)	Dunnachie, Jimmy
Allen, Graham	Dunwoody, Mrs Gwyneth
Alton, David	Eagle, Ms Angela
Anderson, Donald (Swansea E)	Eastham, Ken
Anderson, Ms Janet (Ros'dale)	Enright, Derek
Armstrong, Hilary	Etherington, Bill
Ashdown, Rt Hon Paddy	Evans, John (St Helens N)
Ashton, Joe	Ewing, Mrs Margaret
Austin-Walker, John	Fatchett, Derek
Banks, Tony (Newham NW)	Faulds, Andrew
Barnes, Harry	Field, Frank (Birkenhead)
Barron, Kevin	Fisher, Mark
Battle, John	Flynn, Paul
Bayley, Hugh	Foster, Rt Hon Derek
Beckett, Rt Hon Margaret	Foster, Don (Bath)
Beith, Rt Hon A. J.	Foulkes, George
Bell, Stuart	Fraser, John
Benn, Rt Hon Tony	Fyfe, Maria
Bennett, Andrew F.	Galloway, George
Benton, Joe	Gapes, Mike
Bermingham, Gerald	Garrett, John
Berry, Dr. Roger	George, Bruce
Betts, Clive	Gerrard, Neil
Blair, Tony	Gilbert, Rt Hon Dr John
Blunkett, David	Godman, Dr Norman A.
Boateng, Paul	Godsiff, Roger
Boyce, Jimmy	Golding, Mrs Llin
Boyes, Roland	Gordon, Mildred
Bradley, Keith	Gould, Bryan
Bray, Dr Jeremy	Graham, Thomas
Brown, Gordon (Dunfermline E)	Grant, Bemie (Tottenham)
Brown, N. (N'c'tle upon Tyne E)	Griffiths, Nigel (Edinburgh S)
Burden, Richard	Griffiths, Win (Bridgend)
Byers, Stephen	Grocott, Bruce
Callaghan, Jim	Gunnell, John
Campbell, Mrs Anne (C'bridge)	Hain, Peter
Campbell, Menzies (Fife NE)	Hall, Mike
Campbell, Ronnie (Blyth V)	Hanson, David
Campbell-Savours, D. N.	Hardy, Peter
Canavan, Dennis	Harman, Ms Harriet
Cann, Jamie	Harvey, Nick
Carlile, Alexander (Montgomry)	Hattersley, Rt Hon Roy
Chisholm, Malcolm	Henderson, Doug
Clark, Dr David (South Shields)	Heppell, John
Clarke, Eric (Midlothian)	Hill, Keith (Streatham)
Clarke, Tom (Monklands W)	Hinchliffe, David
Clelland, David	Hoey, Kate
Clwyd, Mrs Ann	Hogg, Norman (Cumbernauld)
Coffey, Ann	Home Robertson, John
Cohen, Harry	Hood, Jimmy
Connarty, Michael	Hoon, Geoffrey
Cook, Frank (Stockton N)	Howarth, George (Knowsley N)
Cook, Robin (Livingston)	Howells, Dr. Kim (Pontypridd)
Corbett, Robin	Hoyle, Doug
Corbyn, Jeremy	Hughes, Kevin (Doncaster N)
Corston, Ms Jean	Hughes, Robert (Aberdeen N)
Cousins, Jim	Hughes, Roy (Newport E)
Cox, Tom	Hughes, Simon (Southwark)
Cryer, Bob	Hutton, John
Cummings, John	Illsley, Eric
Cunliffe, Lawrence	Jackson, Glenda (H'stead)
Cunningham, Jim (Covy SE)	Jackson, Helen (Shef'ld, H)
Cunningham, Rt Hon Dr John	Jamieson, David
Dafis, Cynog	Janner, Greville
Darling, Alistair	Johnston, Sir Russell
Davidson, Ian	Jones, Barry (Alyn and D'side)
Davies, Rt Hon Denzil (Llanelli)	Jones, leuan Wyn (Ynys Môn)
Davies, Ron (Caerphilly)	Jones, Jon Owen (Cardiff C)
Davis, Terry (B'ham, H'dge H'I)	Jones, Lynne (B'ham S O)
Denham, John	Jones, Martyn (Clwyd, SW)
Dewar, Donald	Jones, Nigel (Cheltenham)
Dixon, Don	Jowell, Tessa

Kaufman, Rt Hon Gerald	Prentice, Gordon (Pendle)
Keen, Alan	Prescott, John
Kennedy, Charles (Ross,C&S)	Primarolo, Dawn
Kennedy, Jane (Lpool Brdgn)	Purchase, Ken
Khabra, Piara S.	Quin, Ms Joyce
Kilfoyle, Peter	Radice, Giles
Kinnock, Rt Hon Neil (Islwyn)	Randall, Stuart
Kirkwood, Archy	Raynsford, Nick
Leighton, Ron	Redmond, Martin
Lestor, Joan (Eccles)	Reid, Dr John
Lewis, Terry	Rendel, David
Livingstone, Ken	Robertson, George (Hamilton)
Lloyd, Tony (Stratford)	Robinson, Geoffrey (Co'try NW)
Llwyd, Elfyn	Roche, Mrs. Barbara
Loyden, Eddie	Rogers, Allan
Lynne, Ms Liz	Rooker, Jeff
McAllion, John	Rooney, Terry
McAvoy, Thomas	Ross, Ernie (Dundee W)
McCartney, Ian	Rowlands, Ted
Macdonald, Calum	Ruddock, Joan
McFall, John	Salmond, Alex
McKelvey, William	Sedgemore, Brian
Mackinlay, Andrew	Shearman, Barry
McLeish, Henry	Sheldon, Rt Hon Robert
Maclennan, Robert	Shore, Rt Hon Peter
McMaster, Gordon	Short, Clare
McNamara, Kevin	Simpson, Alan
McWilliam, John	Skinner, Dennis
Madden, Max	Smith, Andrew (Oxford E)
Maddock, Mrs Diana	Smith, C. (Isl'ton S & F'sbury)
Mahon, Alice	Smith, Rt Hon John (M'kl'ds E)
Mandelson, Peter	Smith, Llew (Blaenau Gwent)
Marek, Dr John	Snape, Peter
Marshall, David (Shettteston)	Soley, Clive
Marshall, Jim (Leicester, S)	Spearing, Nigel
Martin, Michael J. (Springburn)	Spellar, John
Martlew, Eric	Squire, Rachel (Dunfermline W)
Maxton, John	Steinberg, Gerry
Meacher, Michael	Stevenson, George
Michael, Alun	Stott, Roger
Michie, Bill (Sheffield Heeley)	Strang, Dr. Gavin
Michie, Mrs Ray (Argyll Bute)	Straw, Jack
Milburn, Alan	Taylor, Mrs Ann (Dewsbury)
Miller, Andrew	Taylor, Matthew (Truro)
Mitchell, Austin (Gt Grimsby)	Tipping, Paddy
Moonie, Dr Lewis	Turner, Dennis
Morgan, Rhodri	Tyler, Paul
Morley, Elliot	Walker, Rt Hon Sir Harold
Morris, Rt Hon A. (Wy'nshawe)	Wallace, James
Morris, Estelle (B'ham Yardley)	Walley, Joan
Morris, Rt Hon J. (Aberavon)	Warded, Gareth (Gower)
Mowlam, Marjorie	Wareing, Robert N
Mudie, George	Watson, Mike
Mullin, Chris	Welsh, Andrew
Murphy, Paul	Wicks, Malcolm
Oakes, Rt Hon Gordon	Wigley, Dafydd
O'Brien, Michael (N W'kshire)	Williams, Rt Hon Alan (Sw'n W)
O'Hara, Edward	Williams, Alan W (Carmarthen)
Olner, William	Wilson, Brian
O'Neill, Martin	Winnick, David
Orme, Rt Hon Stanley	Wise, Audrey
Parry, Robert	Worthington, Tony
Patchett, Terry	Wray, Jimmy
Pendry, Tom	Wright, Dr Tony
Pickthall, Colin	Young, David (Bolton SE)
Pike, Peter L.
Pope, Greg	Tellers for the Noes:
Powell, Ray (Ogmore)	Mr. John Thompson and
Prentice, Ms Bridget (Lew'm E)	Mr. Alan Meale.

Question accordingly agreed to.

It being after five hours after the commencement of the adjourned proceedings, MADAM DEPUTY SPEAKER, pursuant to Order this day, designated Lords amendments Nos. 296, 324, 379, 414 to 416 and 423 as appearing to her to involve questions of privilege.

Madam Speaker

then put forthwith the Questions on any amendment moved by a Minister of the Crown to a Lords amendment and the Question, That this House doth agree with the Lords in an amendment, as amended.