§ '.—(1) It shall be the duty of an employer to offer all employees a payroll deduction facility under which he shall, at the request of the employee, deduct contributions to any approved pensions scheme from that employee's remuneration, net of tax.
§ (2) No charge shall be made to any employee or to any approved pensions scheme in connection with the provision of this facility.—
§ (3) An approved pensions scheme, for the purposes of this section, means any pensions scheme which shall have been —
- (i) approved by the Inland Revenue under Part XIV of the Income and Corporation Taxes Act 1988; and
- (ii) registered for this purpose by the Occupational Pensions Regulatory Authority or by the Financial Services Authority.'.—[Mr. Quentin Davies.]
§ Brought up, and read the First time.
§ Mr. Deputy Speaker
With this, it will be convenient to discuss the following amendments: No. 83, in clause 1, page 2, line 20, at end add —'(10) Approved Group Personal Pensions shall be deemed to be stakeholder pensions for the purposes of this Part.'.Government amendments Nos. 42 and 43. No. 80, in clause 3, page 3, line 41, at end insert —'(5A) The fifth requirement is that the employer shall require a certificate from the designated scheme to the effect that none of his employees will be admitted to membership of that scheme without evidence that that employee has taken independent advice in relation to his pension provision.'.
No. 81, in page 3, line 41, at end insert —'(5B) The sixth requirement is that, for the purpose of calculating the income tax payable to the Inland Revenue under PAYE in respect of an employee exercising his option under subsection (5) above the employer shall disregard —
- (i) the first £5,000 per annum of any pensions payments made under this section, or
- (ii) such amounts as shall be calculated by reference to age-related tables supplied by the Inland Revenue showing the percentage of earnings which may be claimed as tax-deductible contributions to personal pensions schemes,
1298 provided that the employee shall be given the right to choose between £5,000 per annum and the relevant age X2013;related percentage of earnings.'.
Government amendments Nos. 44, 28 and 46.
§ Mr. Deputy Speaker
Order. The business of the House is continuing. Hon. Members should leave the Chamber quietly.
§ Mr. Davies
Almost anything that occurred after this afternoon's events would be an anticlimax. Indeed, the events of this afternoon are without precedent in this Parliament —and for quite a long time before that.
The Government have tried to muzzle Parliament using a disgraceful guillotine motion, which denies the House the right to vote individually on Government amendments. We are not allowed to take issue with Government amendments, to select between them or to move our own amendments. If the many countries around the world that so admire British democracy were to learn of the way in which we conduct our proceedings in this place —a Government with a substantial majority have forced through an obnoxious measure affecting disabled people by the use of a guillotine —they would be quite shocked. They would wonder what kind of Parliament we have.
Nevertheless, the voice of Parliament has been heard. It is clear that there is grave concern on both sides of the House about the damage the Government are doing to our welfare system, our national insurance system and to the interests of some very vulnerable people in this country. We have the good fortune to have a two-Chamber legislature in this country, and we all hope that the business that this House has so unfortunately and dramatically left unfinished this afternoon will be taken up in another place and that the right decisions will be made.
It now falls to me to speak to new clause 13 and amendments Nos. 83, 80 and 81 in my name and those of my hon. Friends. New clause 13 is in some ways a summation of the Conservative Opposition's views on the Government's stakeholder pension proposals, so it might be sensible if I were to address that last, and proceed to it by dealing first with the other amendments.
Amendment No. 80 deals with the vital matter of the advice that people need when they make the decision, which is crucial to their future, as to whether they should invest in a pension, and if so, what kind of pension. The Government have clearly effected an amusing U-turn on that matter.
§ Mr. John Bercow (Buckingham)
Does my hon. Friend agree that it is unfortunate that, as he begins to address a series of important matters, the Secretary of State has left the Chamber? Does my hon. Friend think that the right hon. Gentleman has done so in something of a huff?
§ Mr. Davies
If the right hon. Gentleman has any human feelings —I am sure that he has —he must be feeling intensely embarrassed. As my hon. Friend knows, 1299 when one feels intensely embarrassed and one has got oneself and one's party into a terrible mess, one tends to avoid other human company, particularly in places as public as the Chamber. [Interruption.]
§ Mr. Deputy Speaker
Order. We cannot have all this arguing and shouting across the Floor of the Chamber.
§ Mr. Davies
We can all feel some sympathy for the Secretary of State's wish to hide his face at this juncture.
§ Mr. Davies
I shall be happy to give way to the hon. Gentleman in a moment, but the hon. Lady, who played such a charming part in our Committee proceedings, caught my eye first.
§ Kali Mountford
I am grateful to the hon. Gentleman for giving way —he is always courteous. Will he describe to the House the embarrassment that the hon. Member for Chingford and Woodford Green (Mr. Duncan Smith), the shadow Secretary of State, must also be suffering?
§ Mr. Davies
I have no idea to what the hon. Lady is referring. No Conservative Member is suffering embarrassment about this afternoon's proceedings; far from it. There is no gloating, because this is an important matter and we have not succeeded in securing the necessary protection for the interests of disabled people, but our attitude is clearly far from being one of embarrassment. I will now give way to the hon. Member for Denton and Reddish (Mr. Bennett) if he still wants to intervene.
§ Mr. Bennett
It seems odd that Conservative Members are making a fuss about my right hon. Friend the Secretary of State leaving the Chamber when the hon. Member for Chingford and Woodford Green (Mr. Duncan Smith) did exactly the same. Obviously, he had decided that this is not a key issue.
§ Mr. Davies
The hon. Gentleman not only gives me the opportunity but almost obliges me to make a point that I did not intend to make because I do not want to add to the Secretary of State's discomfort at a difficult moment for him. However, in the light of the hon. Gentleman's intervention, I must remind the House —we were all here and witnessed it —that my hon. Friend the Member for Chingford and Woodford Green (Mr. Duncan Smith) was here throughout the proceedings that lasted from Monday night until Tuesday morning. He may have left, as I did, for a few minutes at a time for particular reasons, but he was here for almost 14 hours, as many of us were. The Secretary of State managed four minutes in the Chamber, so embarrassed was he already at the growing storm created by his clumsy and insensitive handling of the matter.
I must return to the important issue of advice. Labour Members sprung up to try to intervene on my speech and divert me from my course because, as I said, the Government have performed a hilarious U-turn on the matter. I would be the last person to try to take advantage 1300 of someone who had honestly changed their mind, provided they had the straightforwardness and honesty to say so and, if carrying out public responsibilities —as the Government self-evidently are —to explain to the House and the public why they have changed their mind. Instead, we have had a 180 deg U-turn on advice, with the Government pretending that it has not been a U-turn.
I shall read one or two quotations to make it absolutely plain how the Government's position on advice has changed so much. I shall start with the Green Paper, "A New Contract for Welfare: Partnership in Pensions", which the Government produced as recently as December 1998 —the document that we have had occasion to refer to in our proceedings several times, and which I do not doubt that we shall have to refer to again. On page 56, at paragraph 48, it says:We intend to reduce, as far as possible, the need for individuals to seek financial advice when they consider joining a stakeholder pension scheme.
That was very plain, and it is clear that the Minister of State continued in that frame of mind for at least another few months because, on 30 January, he was quoted in The Daily Telegraph as saying:we can enable more people to make a reasonable decision about joining a pension scheme without the need for detailed individual advice.
Once we got into Committee, I made it plain to the Minister that it was thoroughly irresponsible to think of people taking a decision on a matter as important as their pension without detailed individual financial advice. I also made it plain to him that the Government, by their ham-handedness and incompetence, had introduced into pensions a degree of gratuitous complexity, fragmentation and detail, which made it even more necessary for people to seek advice.
The Minister obviously took notice of those points, because he started subtly to nuance his position and then began to do a complete volte-face. For example, in Committee he said exactly the opposite of what he had told The Daily Telegraph only two months before. He said:It is vital that people can seek financial advice when they consider joining a pension scheme and that they will receive good and accurate advice." —[Official Report, Standing Committee D, 9 March 1999; c. 113.]I quite agree with him about that. By 27 April, his boss, the Secretary of State, whom I mentioned just now in a different context, said:Certainly on something like a pension, which is more important than buying a house," —he is right about that —there has got to be some provision for advice".
Recently, the Minister of State gave a written answer to my hon. Friend the shadow Secretary of State for Social Security, in which he said:Appropriate information and advice for those who need it will be an important part of the decision-making process for individuals considering a stakeholder pension scheme." —[Official Report, 10 May 1999; Vol. 331, c. 53.]
Therefore it is absolutely plain that the Government have fundamentally changed their mind. I am glad that they have changed their mind, but I wish that they had had the straightforwardness, and perhaps the modesty —not a quality that has been pre-eminent in the present Government —to admit that they were wrong in the first place, and that they have come round.
1301 I emphasise, as I did in Committee —causing the Government to change their mind —that it is now much more problematic than it ever has been for people on modest or small earnings to decide whether they should save for a pension at all. 1 have previously set out in the House, my calculation that one needs to save at least £80,000 in one's pension scheme before the annuity that one would get at the age of 60 will equal the minimum income guarantee that the Government have introduced for pensioners —which is means-tested —plus the other means-tested benefits: housing benefit, council tax relief and so on. If one did have —80,000, one would have an annuity exactly equal to what one would have got if one had never saved at all, and one would have lost —80,000 of consumption in the course of one's life. That means that one's family and oneself would have gone without a lot of things that everyone might have enjoyed.
The threshold is much higher than £80,000 and is growing all the time as it is bound to, not least because of the Government's foolish decision to promise that the minimum income guarantee will be indexed to earnings and will rise with them. The state retirement pension rises in line with prices. That is another thoroughly irresponsible decision and one which is deeply destructive of the principle of national insurance. The Government are basically saying that they will review and revalue a means-tested payment for which no one has contributed at a higher rate than payments for which people have contributed through the national insurance system.
§ Mr. Webb
I bring the hon. Gentleman back t) amendment No. 80, which he started to describe. I accept that it is desirable for advice to be available and that the giving of advice should be encouraged, but, as 1 read it, amendment No. 80 makes it compulsory to take advice. Is that his intention and should people be forced to take advice, even if they are well informed and do not need it?
§ Mr. Davies
Amendment No. 80 makes taking advice compulsory in the sense that, as at present, anyone who is selling a pension must make sure that the sale is appropriate, that the purchaser has received advice and that someone has taken a view on whether the pension is appropriate. People can simply walk into a life office and buy a pension, as long as the office is convinced that they have taken independent advice. However, it is up to those who are selling pensions to know their customers and to determine that what they are selling is appropriate. That is the basis of the rules applied by the financial regulators.
§ The Minister of State, Department of Social Security (Mr. Stephen Timms)
The hon. Gentleman is making an interesting case, and I look forward to responding to it. Does he take the view that people joining occupational pension schemes should also take advice?
§ Mr. Davies
I take the view that trustees of occupational pension schemes must get it quite clear in their own minds, as part of their fiduciary responsibility to their pensioners, that the product that is being sold is appropriate. By definition, an employer-only contribution scheme is a good deal for the pensioner because it involves him receiving something that he would not otherwise receive. If an employee is also making 1302 contributions, the trustees clearly have a fundamental duty to make sure that the scheme is a good deal for the pensioners involved.
There is protection, and we want to make sure that exactly the same kind of protection exists in stakeholder pension schemes. We want to make sure that that fundamental principle is safeguarded when employers provide a pension facility or when the pensions industry provides a pension, in the stakeholder context or in any other context.
§ Mr. Davies
Yes, but we have little time at our disposal. This is the last intervention that I will take.
§ Mrs. Browning
People on lower incomes, who the Government say are their targets for such pensions, could have earnings from more than one part-time job. Is not it crucial that they receive the right advice about their pension input?
§ Mr. Davies
It is indeed important that those people receive advice about pension input. Even if the earnings from their individual jobs are below the lower earnings limit, the sum of their earnings may be such that it would not make sense, in the light of this extension of means-testing, for them to make any provision for themselves at all. That position is sad and ironic —it is not one that we would have wanted to get into, but, unfortunately, it is one into which the Government are putting an ever-wider range of our citizens. That is the great problem —they still have not seen that one, even though they appear to have accepted the arguments about advice in principle.
I set out a number of other specific cases in our pensions debate last week. People obviously need complex, individual, targeted and tailored advice. For example, someone earning £9,000, who would be on the borderline for the proposed state second pension, would need advice on whether to stay in that scheme. People earning slightly more than £9,000 would also need advice on whether to stay with that scheme and on where the cut-off point comes. They would need advice on whether to join an occupational pension scheme or whether to take a personal or a stakeholder pension. These are complicated issues and the specifics of the individual must be taken into account. Generalised answers cannot be given. A young person expecting to change jobs or to become self-employed might well do much better to opt for a money purchase scheme rather than a final salary scheme, while someone expecting to stay for a long time might do better to opt for a final salary scheme.
Higher up the income scale —the scale from, say, £9,000 to £20,000, £25,000 or £30,000, which has been targeted for the purpose of stakeholder pensions —complicated individual decisions must still be made. People must ask themselves whether they should take out a personal pension or a stakeholder pension. They may already have a personal pension with costs that are apparently higher —but those costs may have been paid at the outset. In terms of the marginal, or incremental, costs, a personal pension may be a much better option than a stakeholder pension.
1303 All those decisions require professional advice —actuarial advice. It is monstrous of the Government to suggest, as they have in a number of recent statements, that it is satisfactory for people to be left to pay for that advice themselves. It is cruel and cynical to tell someone with an income of £9,000 a year to consult an actuary or accountant: the cost of such professional advice would almost certainly enter into the equation, and influence the decision about whether the person should save for a pension at all.
If the advice is not given, however, two things will happen. The person concerned may well be wasting his or her money —and it is particularly sad if someone with low earnings is led by the Government into wasting his or her hard-earned money. Moreover, employers who, if the Bill ever becomes law, may be forced to designate a pension scheme, and the pension companies that might provide the schemes, may be open to a charge of mis-selling unless the advice is provided.
Amendment No.80 proposes that, before a pension is sold, the employer must ensure that the person concerned has been properly advised. Employers may sometimes be able to discharge the responsibility themselves by ensuring that independent advice is available, but such a responsibility would impose an unreasonable burden and an unreasonable cost on smaller employers. Trade unions and similar bodies might be able to help, and we would welcome that; but we insist that advice should be given, and that the principle currently applying in the pensions market should apply in this instance.
The purpose of those rules in the pensions market is to prevent further mis-selling. As we all recognise, we had a bad mis-selling scandal in the 1980s, and I hope that we have learned some lessons from it. Until a couple of months ago, the Government did not appear to have learned any lessons, but they have learned one lesson now: they know that there will be terrible mis-selling —mis-selling on an unprecedented scale —unless the issue of advice is dealt with properly. They say that they now accept the need for advice, but they still have not told anyone how they will pay for it.
Let me now deal with amendment No.81, which concerns tax. One of the stupidest things that the Government have done has been to introduce, unnecessarily and gratuitously, a second tax regime for pensions —a second set of rules determining tax deductibility in the case of those who join stakeholder schemes. The Government say that those who join such schemes will be able to deduct £3,600 from their income by way of a tax credit, whereas the existing Inland Revenue sliding scale —involving a percentage of earnings increasing with age —will continue to apply to those who opt for personal pension schemes.
The Government are so incompetent that they do not seem to have taken into account what will result from the mere fact of having two different tax regimes. I shall say more shortly about the merits or otherwise of their proposed regimes, but the existence of two regimes in itself will increase the uncertainty and the complexity of the calculations that will need to be made, and will make it even more difficult for people to decide whether to opt for particular pension schemes.
I trust that the Minister has finally understood the point about advice. Perhaps he will now understand the point about tax. He is certainly not a foolish individual, and he 1304 has a good business record himself. Perhaps his hands are tied — and his feet, and his mouth —by his bosses, or by the Treasury. In that case, I hope that he will be a bit more vigorous in persuading them to be more sensible.
Let us look at the case of someone who is considering going into a pension scheme and is thinking of a stakeholder or a personal pension. If his income is £20,000 or less, he has decided that he needs a funded individual pension and he never expects to earn more than that in real terms, no doubt, the £3,600 is totally adequate. However, he may hope to get promotion, a pay increase or bonuses for good performance. We want a society and economy where people have a chance to increase their earnings, particularly through higher performance. We want people to be able to use their bonuses to fund a pension, savings and so forth. At least I think we do; Conservative Members certainly do. In that case, clearly, he should not go into a scheme where the tax deductibility of pension contributions is limited to £3,600 a year. He might want to make contributions that will give him greater tax deductibility and tax relief on the Inland Revenue sliding scale. That would be a reason to take out not a stakeholder, but a personal pension.
The worse scenario would be to take out a stakeholder pension, to meet the costs of setting up that scheme and, a few years later, to have to close that, to move into a personal pension and to pay a whole lot of new transactional costs to set up a new scheme. That would not make any sense. Again, it is deplorable that the Government have not been able to work that one out themselves.
Amendment No. 83 deals with group personal pensions. [Interruption.] Someone took away my copy of the Green Paper. That took my breath away, at least for a moment or two. On group personal pensions, another wonderful U-turn is in process; at least I hope it is because the Government's initial proposals were deeply damaging.
Page 53, paragraph 29 of the Green Paper makes it plain —it could not be plainer in the English language:Existing personal pensions will not therefore be able to describe themselves as stakeholder pension schemes.Personal pensions will not be able to be passported into, in the modern jargon, the stakeholder system. People who have a personal pension of any type could not treat that as their stakeholder pension. Employers who had set up a group personal pension scheme could not treat that as the discharge of the obligation, which is placed on them in clause 3, to set up a stakeholder scheme.
That is extremely regrettable because it will mean that many good pension schemes, including group personal pensions, which invariably, in every example known to me, involve an employer contribution, will have to be wound down. Employers would then have to set up another stakeholder scheme, which does not require an employer contribution at all.
Therefore, if employers are feeling slightly less generous, or are simply exasperated by the Government forcing them to run down one good pension scheme for their employees and to set up another, they might take the opportunity either to reduce, or to eliminate their contribution altogether. That would be terrible for the employees concerned and a great blow to pensions.
That is thoughtlessness at best. At worst, it would have been a deliberate attempt to destroy at a stroke a valuable part of our pension structure, but I think that 1305 the Government are guilty more of ignorance and incompetence than deliberate destructiveness. You will note, Mr. Deputy Speaker, that I am capable of being very kind to the Government.
§ Mr. Davies
As my hon. Friend kindly says, I am a generous man. I hope that that characterisation is always justified by my conduct in the House and, indeed, elsewhere.
The U-turn, which is perhaps now taking place, has not been announced to the House. Such things are announced in the press or the media, but never to the House. On 28 April, the Secretary of State gave an interview to the Financial Times and said:Some group personal pensions may be allowed to label themselves as stakeholder pensions. Alistair Darling, the Social Security Secretary has said. That could remove the need for employers to separate stakeholder pensions to their employees".In a written answer to my hon. Friend the Member for Chingford and Woodford Green, the Minister of State said:Group personal pensions will be able to register as stakeholder pension schemes provided they meet the required conditions for such schemes." —[Official Report, 10 May 1999; Vol. 331, c. 53.]That is an even stronger move sin the direction of allowing personal pensions to count as stakeholder pensions. That is a 180 deg contrast with the statement in the Green Paper.
We have tabled our amendments because of all the U-turns by the Government. There has been no explicit acknowledgement by the Government that they have got it wrong. I do not want to labour that because, if they are not big enough to admit that they occasionally make mistakes, that is too bad for them. They should at least come to the House to make these announcements plainly and unambiguously because they are creating great uncertainty outside.
People in the pensions industry look at the Green Paper, which they are entitled to believe represents Government policy until it is changed, and they then see newspaper articles and remarks attributed to Ministers, and they do not know where they are. It is contributing to an unfortunate crisis which is paralysing our pensions market. Employers and pension funds are frightened to move forward and sell stakeholder pensions because of the danger of mis-selling, to which I have already referred, and the absence of any assurance that there will be independent advice. They do not know what the rules of the scheme will be because they do not know what the Government mean with their confusing proposals such as stakeholders, LISAs —lifelong individual savings accounts —and so on. Also, individuals are rightly and reasonably confused and hesitate to make decisions in the absence of advice.
We are tabling our amendment to remove the uncertainty, at least in relation to group personal pensions, to give companies the confidence to continue with these schemes and, I hope, to encourage companies who do not have existing provisions for their employees to start them. 1306 The amendment would make the regime clear within the Bill. If we achieve some clarity after six months of debate that will be an achievement of some kind.
I described new clause 13 as a summation of our views on stakeholder pensions. It incorporates many of the lessons learned from the Government's extraordinarily shambolic treatment of the matter over the past few months. We do not start on a completely blank sheet of paper, nor should we. However regrettable and unfortunate it may be for many people from the pensions industry right through to the disabled, the Labour Government are in power. They have a democratic mandate and have produced a Bill to set up a stakeholder pension system. We are looking positively to see whether there is something that we can save from the wreck or on which we can build a constructive and worthwhile structure. We are perfectly happy with the idea of employer obligations to set up a payroll deduction facility.
In the pensions debate last week, the Government asked my hon. Friends and myself, perfectly reasonably, about the Conservative party's policy on pensions. They now have it in black and white in new clause 13 and I hope that they will accept it. It is a stakeholder pension scheme based on the employer obligation to provide a free payroll deduction facility for payments into any approved pension vehicle.
Hon. Members should note that the new clause would oblige employers to establish a specific payment facility on a payroll-deduction basis, as they currently administer the pay-as-you-earn and national insurance systems. It would not replicate the obligation, imposed in clause 3 of the Bill, on employers to designate a scheme. As I said, that would be an unreasonably onerous task to impose on small employers —or on any employer. I do not believe that it is an employer's function to take charge of his or her employee's private life or financial affairs.
We therefore do not propose designation, but simply to establish the facility, which will be available for payment into any approved pension scheme — as defined by the Inland Revenue under chapter 14 of the Income and Corporation Taxes Act 1988 and by the Occupational Pensions Regulatory Authority.
In our new clause, we get away entirely from fragmentation. We are not saying, for example, that people may pay only into schemes established on the basis of trust law. We should be equally happy with personal and other pensions that are set up on a deed-poll basis. The facility could be used to invest in a personal pension; a stakeholder pension, as the Government are suggesting; or in a lifetime individual savings account —the rival Treasury product —which we think has considerable merit and attraction.
§ Mr. Davies
I cannot give way now, as I am trying to bring my remarks to a close. I have already taken a number of interventions, including one from the hon. Gentleman, as he will remember.
The essence of our proposal is that it would avoid all gratuitous fragmentation and include a unified tax regime. The regime would be unified in that employees benefiting 1307 from the facility would be able to take an annual deduction of £5,000— we are a little more generous than the Government, and choose a round figure— without any questions being asked about how it might relate to his or her income or, if he or she prefers, to apply the current Inland Revenue sliding scale of income percentage rising with age.
Clearly, employees will choose whatever suits them best in any one year, and there will be no difficulty about employees whose circumstance might change in future, when they will be able to make higher contributions. We want them to be able to do that, and therefore to receive the corresponding tax deductions. However, to achieve that goal, we shall have to avoid the creation of unnecessary barriers and fragmentation.
In a few words, we are offering a single, unified and coherent structure that really will advance the cause of United Kingdom pensions — to which we have been, and always will be, most sincerely committed.
§ Mr. Flight
I should like to stress two specific points, on the necessity of advice. The first point—to which my hon. Friend the Member for Grantham and Stamford (Mr. Davies) alludedc—is that 8 million people currently have personal pension schemes and have already paid for the up-front marketing costs, whatever those might have been. As Ministers will know— with the introduction of the Green Paper and the great white hope of the new stakeholder schemes — the number of people dropping out of personal pension schemes is increasing substantially, probably very much to their detriment. It is, therefore, crucial that people should receive very clear quantitative advice when deciding whether to participate in a new stakeholder scheme or to remain in their current pension scheme.
The second point has not yet been made in the debate. There is a very high probability that — because of the CAT-marking arrangements to keep charges low — most stakeholder schemes offered by companies will invest in index trackers. Although I do not want to get into a debate on the merits of active versus index tracker management, individuals will have to make the important decision on which they should opt for.
The pension assets in index tracker schemes will go up and down with markets. Those with a personal pension scheme usually have a choice of different funds to invest in, and can make their scheme more or less cautious and change according to circumstances. It is important that people should know and get advice when choosing between their existing personal scheme and the new stakeholder. They should know the significance of the likely index tracker investment versus active investment management.
As I understand it, the tax deductible sum for stakeholder schemes is not a simple £ 3,600 per annum, but the lesser of that figure or 100 per cent. of salary. I do not understand the reason for the second part of the formula. Working out which is the lesser and keeping records of people's salaries to no apparent end will be a waste of time and money, resulting in unnecessary extra charges for stakeholders. I support our proposal for a tax regime that would be the same for all pension schemes 1308 irrespective of their category. The stakeholder proposals simply add costs. Those are some specific points on the two key areas that we are advancing.
§ Mr. Webb
The hon. Member for Grantham and Stamford (Mr. Davies) mentioned four issues: advice, tax relief, the treatment of group personal pensions and access through employers to all pension schemes. Perhaps it will be helpful if I address those four points in the sequence in which he raised them.
We all agree that pensions are complicated and it is important that people are well informed when they make choices. To that extent, I have common ground with the hon. Gentleman. All the quotes that he read out were about the importance of access to good advice — I have no problem with that — but the substance of his proposals, as I think that he more or less accepted, is that people should be compelled to take advice. Amendment No. 80 says that the employer should ask the person running the stakeholder scheme to issue a certificate saying that he will not let any employees into the scheme unless they prove that they have taken independent advice.
§ Mr. Quentin Davies
The hon. Gentleman should not misrepresent my words to imply that we suggest that the law should place a charge on people to seek advice regardless of whether they want a pension. We are simply saying that when a pension is sold, the responsibility must lie with the seller — or the employer if they are designating or sponsoring the scheme — to make sure that the individual concerned has been properly advised before taking out the pension. Without that provision, there would be a recipe for the most appalling mis-selling. That would be particularly cruel for people on lower incomes, whom we are most concerned about.
§ Mr. Webb
That may be the hon. Gentleman's intention, but it is not the effect of his amendments. Amendment No. 80 says that an employee will not be admitted to the stakeholder scheme that the employer is associated with unless the scheme provider can prove that independent advice has been taken by each person who goes into the scheme. That is appropriate for some people, but for others who are well informed and for whom the stakeholder scheme provided by the employer is self-evidently the right scheme, particularly if there is an employer contribution, there is no reason for a legal obligation. It seems a very un-Conservative proposal— although that is not a reason for opposing it — to require even the well informed to take advice. I understand what the hon. Gentleman is trying to achieve, but amendment No. 80 clearly does not do that.
The same is true of amendment No. 81 about tax relief. The amendment raises two issues. The first is whether the £ 3,600 figure is high enough. I have some interest in the hon. Gentleman's point that it may not be. However, the amendment goes on to propose not a simple £ 5,000, but £ 5,000 or the amount allowed under the age-related rebate schemeprovided that the employee shall be given the right to choose".The hon. Gentleman said that he wanted to simplify the tax regime, but that he wanted people to choose which tax regime they preferred. The tax regime for stakeholder 1309 schemes will be different from that for occupational schemes, which appear not to be covered by the amendment.
§ Mr. Davies
The hon. Gentleman is having great difficulty in understanding something very simple. If the employee chooses, there is no fragmentation of the market from the employee's point of view. It does not matter which tax regime he chooses this year, because he can choose another next year if that is more appropriate to his circumstances. Therefore, we are reducing the complexity of choice and the danger of a mis-choice or a mis-sell.
§ Mr. Webb
The hon. Gentleman is introducing a new choice. If I take out a pension at the moment, I have no choice about the tax regime that applies to my contributions. The amendment introduces a choice of whether I want the lump sum cap on my contributions to get tax relief or some percentage of my salary. That seems to create greater complexity.
My colleagues and I would like a single annual amount, allowable against tax, for all sorts of pension savings — not choices between different schemes. I fear that that would introduce new complexity, contrary to what is intended.
On group personal pensions, the issues are more difficult. The hon. Member for Grantham and Stamford and his party want to allow group personal pensions to be eligible for stakeholder status. Amendment No. 83 says:
Approved Group Personal Pensions shall be deemed to be stakeholder pensions for the purposes of this Part.It does not say, "some shall, provided they satisfy the standards of stakeholder schemes." One wonders what the point of the first 40-odd clauses of the Bill is if an existing form of pension provision will automatically come under the new category.
Clearly, some existing group personal pensions may or may not be good value for money for their members, and the charging structure may be unfavourable to those who are likely to leave early, for example. Simply to say that they will come under the stakeholder scheme and get all the associated advantages is rather difficult. If the amendment were more extensive, and said that they can count as stakeholder schemes if they meet the relevant criteria, we might have had more sympathy. However, as it stands, I am afraid that we do not.
The first time I saw new clause 13 I thought that it was eminently sensible. However, when the hon. Member for Grantham and Stamford explained it, 1 went off the idea. I wanted some clarification from the hon. Gentleman during his speech, and perhaps he will intervene on me in a moment to explain the point — briefly, I hope.
Under new clause 13, an employer with 3,000 employees would be obliged to provide free of charge a facility to every employee to deduct at source a pension contribution, and to pay that contribution to the pension scheme of the employee's choosing. The Government are proposing one scheme — that the employer would provide access to one stakeholder scheme. It is reasonable to suppose that the employer would then take all the contributions in one go and pass them in one envelope, metaphorically, to the scheme.
1310 As I understand it, the hon. Member for Grantham and Stamford is saying that the employer, at his own cost, will have to pay contributions to every different scheme of which any individual employee is a member. Clearly, individual employees can be members of dozens of different schemes — particularly if there is no company scheme. At a medium-sized firm with no company scheme, individuals could be members of dozens of different pensions schemes.
§ Mr. Davies
The hon. Gentleman ought to know that employers already must have the software set up to enable them to make such payments under earnings attachment orders and so forth, and these may go in different directions. That is not the great burden — of costs on an employer. The great burden — which our amendment avoids, but the Government's formulation unfortunately involves employers in — is the burden of designating the right scheme. That is an enormous responsibility, and involves spending money on actuaries and advisers, and receiving bids from different pension groups, and then on making a choice between them. That is what we want to avoid. It is an unreasonable burden on the employer, and a dangerous situation in which an employer can find himself.
§ Mrs. Browning
Is not it the case that members of staff of Members of Parliament have, at present, a scheme through the Fees Office where they elect to go into a personal pension with a variety of companies, and on which they are responsible for taking financial advice about whether the scheme to which they are signing up is in their best interests? Surely in terms of administration on the employer — in this case, the Fees Office of the House of Commons — that is complex, when one thinks that there are 650 Members of Parliament. However, it does it. Surely it would simply be a matter of putting the money into a stakeholder scheme rather than into a personal pension as at present. I do not understand the hon. Gentleman's argument about the complexity of administration.
§ Mr. Webb
Indeed, but is it a considerable administrative burden? I suspect that it may well be. Do we know how many people the Fees Office employs to administer those payments? Some Conservative Members here today served with me in Committee on the Tax Credits Bill, where we argued against the burden on business of employers having to pass on tax credits. Under the new clause, employers would have to pass on not only one payment from the Inland Revenue to their employees; 1311 they might have to make dozens of payments to dozens of different companies. I accept that there is a parallel, but we do not how much work is created or what it costs.
§ Mr. Flight
Surely all that is required is for the employer to give a list of instructions to his bank to make regular standing order payments to the various banks of the recipients' pension schemes. Once that was done, there would be no more work involved. That is what the Fees Office does.
§ Mr. Webb
The hon. Gentleman wants to have it both ways. He and I have both attacked the working families tax credit, which is a single payment from the Inland Revenue through the employer to the employee, regarding it as a burden on business. We are now talking about a system that involves as many employees as there are in the firm and as many pension companies as there are in the land. Contrary to what he said, the payments need not be the same every month: people might want to increase their payments following a pay rise or to contribute a lump sum.
We have to form a judgment about the burden placed on business. Intriguingly, Conservative Members do not think that there will be a burden; strangely, I think that there will. We certainly want to facilitate access to pension saving. The Government have got it right in using the mechanism of employers — there are many fewer employers than employees — to deliver to a specified scheme. In my judgment, that is much less of a burden.
§ Mr. Brazier
I served in Committee on the Bill, and we are nearing the end of a process that has gone on for two and a half months. Following the emotionally charged and important debate on incapacity benefit, we can see once again how wrong it was to cram so many different subjects into one Bill, as hon. Members of various parties said on Second Reading. The new clause and the amendments grouped with it are very important, dealing with pension arrangements for people who can only just afford to provide for themselves, but we have a small turnout because this discussion follows a mass of other important subjects.
We are suffering once again from the fact that, because the Government are trying to cram a gallon into a pint pot, there is far too much reliance on regulation. We are trying to pin down what should be done, but much is unclear because of the excessive use of regulation. The regulations and the ideas behind them stem from several different consultations, including the consultation on this part of the Bill, which was not even completed when we began our proceedings in Committee.
In other parts of the Bill, Labour party manifesto commitments — on means-testing and on the contributory principle, for example — were abandoned. The Government's refusal to accept the new clause and associated amendments represents the abandonment of another good principle: that we should seek to simplify the social security and pensions system. Absurdly, with the stakeholder plan, the Government are trying to start again with a completely new edifice which is separate from the Treasury's edifice. That is not completely new, but builds on existing plans, and for that reason, it is mostly welcomed by the Opposition.
The hon. Member for Northavon (Mr. Webb) missed the point of the interventions by my hon. Friends. The point about the working families tax credit, on which we 1312 stood shoulder to shoulder with the Liberal Democrats, is that it is potentially adjustable twice a year on the basis of a complicated calculation. However, as my hon. Friend the Member for Arundel and South Downs (Mr. Flight) pointed out, the arrangements suggested in new clause 13 would be in place for good once a simple standing order had been set up. In the case of the House of Commons scheme, it would be pegged to 10 per cent. of salary. The arrangements would not involve the complexities to which we objected in another context.
By trying to set up such a complicated system, which contained the germ of a good idea when the right hon. Member for Birkenhead (Mr. Field) first proposed it, the Government are setting themselves against the pensions industry and against those who would like to provide better for those at the bottom end of the earnings scale, who will be specifically targeted by the measure. I suspect that the rival Treasury product will be much more successful.
My final point is really a Third Reading point, but I hope that you will forgive me, Mr. Deputy Speaker, because it looks unlikely that we will get to Third Reading. It is very sad that we should be debating all these amendments at the end of proceedings on this Bill. We are dancing round on the head of a pin while the entire debate on pensions policy is crushed between two halves of a nutcracker — one being the devastating blow that was wreaked upon ordinary company, personal and other pensions by the shameful removal of tax credits, and the other being the knowledge that among the low paid, people who do not provide for themselves may end up doing better. That point was eloquently made by my hon. Friend the Member for Grantham and Stamford (Mr. Davies). I strongly support new clause 13 which would go a long way towards improving a rotten, muddled and confused scheme.
§ Miss McIntosh
I strongly associate myself with new clause 13, which was eloquently moved by my hon. Friend the Member for Grantham and Stamford (Mr. Davies). I wish to address two situations. The first is where an employer already operates an occupational pension scheme. Some employers may be tempted to close their occupational pension scheme to new entrants and simply offer access to stakeholder schemes. Small and large employers alike believe that that would be a regrettable move and I hope that the Minister, when he replies, will address that point.
The second situation is where an employer does not already operate an occupational pension scheme. Most employers without such a scheme would admit that they lack the financial skills necessary to choose such a scheme. If they choose the wrong scheme, many fear adverse consequences for themselves and their employees. I hope that the Minister supports the suggestion that employers should be required to provide access only via a pensions clearing house.
§ Mrs. May
For the record, I should declare that I have placed in the Register of Members' Interests a non-registerable shareholding in the Prudential corporation.
Before I make a couple of points about the amendments and the stakeholder scheme, I want to pick up on the comments of the hon. Member for Northavon (Mr. Webb). I am sorry that I was inadvertently out of the Chamber when 1313 he began to speak, but I came in as he was taking interventions on the extent to which proposals for employee payroll deduction facilities in new clause 13 would be a burden on business and difficult to operate.
As a former employee of the Association for Payment Clearing Services, I suggest that if the hon. Gentleman thinks that providing that sort of facility is beyond the scope of the banking sector, he should take a trip to the former de Havilland aircraft site at Edgware to visit BACS — formerly the Bankers Automated Clearing Services company — and see the number of deductions and payments that pass through the system every day. The banking sector is well able to cope with the proposal contained in new clause 13.
§ Mr. Deputy Speaker (Mr. Michael Lord)
Order. It is not possible for the hon. Gentleman to intervene on an intervention.
§ Mr. Brazier
I am grateful to my hon. Friend for being as courteous as ever. The point that I tried to make earlier to the hon. Member for Northavon (Mr. Webb) perhaps needs to be reiterated. The cost and complexity arises not from making a payment, but from having to do the calculation every six months for people whose earnings vary from week to week.
§ Mrs. May
I am grateful to my hon. Friend for clarifying the point that he made earlier. My point is that the banking sector can cope. Businesses produce tapes or telecoms data for banks to put to BACS. Significant numbers of such payments are being made, and if the hon. Member for Northavon is suggesting that new clause 13 should be cast aside on such a technical point, he should visit BACS to see how companies input such information and deal with such payments.
I have two points to make about stakeholders which relate to amendment No. 80. I share the concerns expressed by my hon. Friend the Member for Vale of York (Miss McIntosh), and by pension providers and bodies that represent employers. The Government's stakeholder pension schemes may result in the closure of some occupational pension schemes to new members. Employers will tell employees that they are not carrying on with occupational pension scheme provision, providing instead for the stakeholder pension because that is what the Government say is good.
The way in which we have built up our occupational pension scheme funds is one of the jewels in this country's crown. It places us in a far better position than many other countries to deal with future pension provision. We should not attack that position. I accept that the Government do not 1314 intend to attack occupational pension schemes, but I fear that the law of unintended consequences could very well bring about that result.
Finally, I want to reiterate a point that I made in the Chamber last week on pensions. I am particularly concerned about the impact of the Government's proposals on women. Women are just getting a foot on the ladder of occupational pension schemes, and some schemes may be taken from them. Secondly, many women are concerned already that they do not receive adequate advice about pension proposals. If no advice is provided on stakeholder pension schemes, many women will be disadvantaged in future. I support amendment No. 80 because independent pensions advice is important for all employees, but particularly for women.
§ 7 pm
§ Mrs. Browning
I contribute to this section of the debate with some sadness. Although I was not a member of the Standing Committee, I followed the Hansard record of those deliberations. On the one hand, I must welcome the fact that the new Labour Government have undergone a conversion in respect of personal pensions and pension input per se. Many of us remember how, in the 1980s, every time the Conservatives introduced a Budget to give tax breaks to individuals to encourage them to input into pensions, whether personal or corporate, the Labour party consistently voted against those provisions, which have made Britain one of the strongest countries in Europe for pension funds and provision for old age. Notwithstanding that, the Labour party said time after time before the Labour Government were elected that if it came to office it would make fundamental changes to increase the scope of pension provision for a wider range of individuals and to tighten up aspects where it felt there needed to be more security for the person investing in a pension.
The Committee deliberated and we waited a long while to get proper confirmation from the Government about what they were proposing. Even though we now have a Bill in front of us, the Government still seem unable to answer many questions. I will raise some different issues from those raised by my hon. Friends, and perhaps we will hear one or two answers from the Government.
Given some of the problems, such as pensions mis-selling and the Maxwell scandal, many people may well be concerned about being a part of a group pension of whatever denomination. The Government therefore said that they want to enhance the role of trustees. That is important. However, as the Bill has proceeded, the Government have not been clear about their intentions for trustees.
The Minister of State was adamant in Committee, saying:We want member-nominated trustees to be appointed to the board of stakeholder pension schemes."— [Official Report, Standing Committee D, 4 March 1999; c. 52Despite persistent questioning by my Conservative colleagues, the Government failed to explain who will be the trustees and how they will be chosen. That question seems fundamental. If the Government's new stakeholder pensions are to be widely welcomed and, more important, taken up — particularly if they are to receive the support of employers in the workplace — it is extremely important for that sort of detail to be available. 1315 It is not the sort of detail that should be left to secondary legislation. if we have learned one thing in the past two years it is that many major Bills have been ill thought out — almost cobbled together on the hoof as they progress through Committee. Later, when we are faced with statutory instruments and secondary legislation that put the detail into the Bill, we find that the Government are doing something quite different from what they said in Committee.
I tell the Government and the Minister, who was adamant about trustees in stakeholder pensions, that if they want those pensions to be successful, they should tonight give the House the details of how those trustees will be appointed and take their place on the board.
§ Mr. Timms
The hon. Member for Grantham and Stamford (Mr. Davies) demonstrated again this evening his remarkable ability to make material that is worth five minutes last for 35. The House will have enjoyed that, although why it was necessary for him to do it on this occasion, I am not sure.
Stakeholder pension schemes are at the heart of our plans to modernise the pension system. They will provide — for many people for the first time — affordable funded pensions so that they can look forward to a secure income in retirement. There has been wide support for their introduction from those who responded to the Green Paper and others, both for the aims of the policy and for the structure that we have put in place to achieve them. We are working closely with the industry to ensure their success.
The hon. Member for Tiverton and Honiton (Mrs. Browning) asked about trustees. The Bill provides for stakeholder pensions to be run in a way that puts members' interests first. Trust-based schemes run by a board of trustees will do exactly that. We will consult between now and the summer on the details of how the trustee arrangements will work. If I understood her correctly, she supports the involvement of trustees in the schemes. I agree, but, as I said in Committee, we want to retain flexibility. That is why we have not ruled out possible alternative governance structures if they can deliver comparable protection.
In the Labour party manifesto, we promised to introduce a framework for stakeholder pensions to meet the needs of those who could not join a good-value second pension. We said that schemes would be approved to receive people's savings only if they met high standards and provided value for money, flexibility and security. The framework in the Bill fulfils that commitment. Contrary to what Conservative Members said, there have been no U-turns. Our position on group personal pensions is the one set out in the Green Paper; we asked for views on it on page 59. We are listening to those views and will reach a conclusion on that basis. That is what we always said that we would do, and we will do it.
§ Dr. Lewis Moonie (Kirkcaldy)
My hon. Friend knows that I want to raise the issue of Christian conscience. He is aware that many Christians cannot take up pension plans under existing or proposed legislation. Many hon. Members on both sides of the House have taken the matter up with the Treasury. Can he reassure me that any regulations under the Bill will take account of Christian conscience regarding the appropriate pension offered, 1316 contributions to a scheme and the rights of employees to refuse on Christian conscience grounds any scheme offered?
§ Mr. Timms
I am well aware of those issues. My hon. Friend put one of his constituents in touch with me. A group from the Plymouth Brethren came to discuss those points with me. Nothing in the Bill or any of our proposals would require employers to contribute to pension schemes on behalf of their employees. We are consulting on the possibility of making it a condition of employment that people should join their occupational scheme, if there is one. That would need to be subject to opt-out arrangements. We will carefully consider my hon. Friend's point in deciding them. I think that the people who have been in touch with him and me will feel generally content about our way forward on this.
§ Mr. Leigh
I am sorry to labour the point, but the Plymouth Brethren are a tiny group. No one in the House supports their views, which is all the more reason why we should be careful to ensure that their conscience is protected. They cannot join any existing pension scheme, except the basic state pension, because of their religious belief. The Minister must reassure them that they will not be forced into a stakeholder pension against their conscience.
§ Mr. Timms
I can categorically assure the hon. Gentleman that no one will be forced into a stakeholder pension if they do not wish to join one. The Plymouth Brethren are not that small a group. I much enjoyed the meeting that took place on the initiative of my hon. Friend the Member for Kirkcaldy (Dr. Moonie).
Let me briefly deal with some of the points raised in the debate. New clause 13 would compel employers to offer payroll deduction facilities for almost all pension arrangements. Conservative Members appear to believe that that would provide an adequate replacement for stakeholder pensions. In reality, providing access to other sorts of scheme would not be a substitute for the benefits that we expect for members from stakeholder pension schemes. The hon. Member for Northavon (Mr. Webb) is right to say that the proposals would place a substantial, additional burden on business. Businesses would have to send out regular payments to an unlimited number of pension schemes — depending on how many people work in the organisation. That is not sensible.
The hon. Member for Vale of York (Miss McIntosh) made a much more interesting suggestion. I commend her for raising the point because it seems to have eluded her hon. Friends.
There is a possibility of making a clearing-house arrangement under which employers would make a single payment to a clearing house. The clearing house would then sort out which company the payments should be passed on to. That proposal is favoured by the Confederation of British Industry, for example. It is one of the possibilities on which we shall consult between now and the summer.
Amendment No. 83 would enable existing group personal pensions to qualify as stakeholder pension schemes. Again, we have been absolutely consistent on that point. We do not want to undermine good-value existing provision, but personal pensions do not have many of the features that will make stakeholder pension schemes a good deal for their members.
1317 Stakeholder pension schemes will provide a better-value, more flexible alternative for many of those who cannot join an occupational scheme. The proposed governance structure is an important part of that; we are determined that stakeholder schemes will be run in their members' interests. It is here that personal pension schemes often fall short of the high standards that we want for stakeholder pension schemes. We are keen not to discourage high-quality provision and will be consulting further on our specific proposals as to how we could best incorporate into the new regime arrangements that meet our high standards and offer good-quality provision.
Amendment No. 80 deals with advice. It is right that people considering joining any pension scheme should have access to good, accurate financial information and advice. We have said that throughout, and our commitment to that should not be in doubt. Since we came to office, one of our priorities has been to ensure that pension companies and advisers clear up the mis-selling scandal that we inherited from the previous Government. The arrangements instituted by the Conservative Government created an enormous number of problems — not least by, wrongly, inducing many people to leave good occupational schemes of the kind referred to by the hon. Member for Maidenhead (Mrs. May) and to enter personal schemes that were much less advantageous.
The amendment would require stakeholder pension schemes to certify that all applicants who want to join their employer's designated scheme have received independent financial advice. That goes much too far. Individual advice has a cost. In many cases, that cost is worth paying, but, given the right information, many potential members will be perfectly capable of making an appropriate choice for themselves.
We expect that significant numbers of those joining stakeholder schemes will do so through their employers. To require all those applicants to receive independent advice would impose excessive costs on schemes if they had to meet the costs of its provision — as they will in many cases.
Amendment No. 81 would require a higher limit on contributions to stakeholder pension schemes than the £ 3,600 that we proposed, and proposes that, as an alternative, the limit could be set by reference to the relevant personal pension limit. Our proposal is intended to provide a simple, clear system. I can assure hon. Members that contribution limits are one of the aspects of the schemes on which we shall be carrying out further detailed consultation between now and the summer, in the light of the representations that we have received to date. Following that consultation, all aspects of the tax regime — including the maximum level of contributions — will, as is normal, be set out in a Finance Bill or tax regulations as appropriate, but they will not be included in this Bill.
§ It being six hours after the commencement of proceedings, MR. DEPUTY SPEAKER proceeded to put forthwith the Questions necessary for the disposal of the business to be concluded at that hour.
§ Question put, That the clause be read a Second time: —1318
§ The House divided: Ayes 128, Noes 420.1321
|Division No. 193]
|Abbott, Ms Diane
|Adams, Mrs Irene (Paisley N)
|Coffey, Ms Ann
|Ainsworth, Robert (Cov'try NE)
|Anderson, Donald (Swansea E)
|Anderson, Janet (Rossendale)
|Corston, Ms Jean
|Armstrong, Rt Hon Ms Hilary
|Atherton, Ms Candy
|Cryer, Mrs Ann (Keighley)
|Cryer, John (Hornchurch)
|Cunningham, Rt Hon Dr Jack (Copeland)
|Cunningham, Jim (Cov'try S)
|Curtis—Thomas, Mrs Claire
|Beckett, Rt Hon Mrs Margaret
|Darling, Rt Hon Alistair
|Begg, Miss Anne
|Bell, Stuart (Middlesbrough)
|Davey, Valerie (Bristol W)
|Benn, Rt Hon Tony
|Bennett, Andrew F
|Davies, Rt Hon Denzil (Llanelli)
|Davies, Geraint (Croydon C)
|Dean, Mrs Janet
|Dewar, Rt Hon Donald
|Blair, Rt Hon Tony
|Blears, Ms Hazel
|Dobson, Rt Hon Frank
|Donohoe, Brian H
|Blunkett, Rt Hon David
|Bradley, Keith (Withington)
|Drown, Ms Julia
|Bradley, Peter (The Wrekin)
|Eagle, Angela (Wallasey)
|Eagle, Maria (L'pool Garston)
|Brinton, Mrs Helen
|Brown, Rt Hon Gordon (Dunfermline E)
|Ellman, Mrs Louise
|Brown, Rt Hon Nick (Newcastle E)
|Brown, Russell (Dumfries)
|Field, Rt Hon Frank
|Buck, Ms Karen
|Butler, Mrs Christine
|Byers, Rt Hon Stephen
|Caborn, Rt Hon Richard
|Campbell, Alan (Tynemouth)
|Foster, Michael Jabez (Hastings)
|Campbell, Mrs Anne (C'bridge)
|Foster, Michael J (Worcester)
|Campbell, Ronnie (Blyth V)
|George, Bruce (Walsall S)
|Chapman, Ben (Wirral S)
|Gibson, Dr Ian
|Gilroy, Mrs Linda
|Church, Ms Judith
|Godman, Dr Norman A
|Clark, Rt Hon Dr David (S Shields)
|Clark, Dr Lynda (Edinburgh Pentlands)
|Gordon, Mrs Eileen
|Griffiths, Jane (Reading E)
|Clark, Paul (Gillingham)
|Griffiths, Nigel (Edinburgh S)
|Clarke, Charles (Norwich S)
|Griffiths, Win (Bridgend)
|Clarke, Eric (Midlothian)
|Clarke, Rt Hon Tom (Coatbridge)
|Clarke, Tony (Northampton S)
|Hall, Patrick (Bedford)
|Hamilton, Fabian (Leeds NE)
|Harman, Rt Hon Ms Harriet
|McCartney, Rt Hon Ian (Makerfield)
|Heal, Mrs Sylvia
|Henderson, Doug (Newcastle N)
|Henderson, Ivan (Harwich)
|McGuire, Mrs Anne
|Hewitt, Ms Patricia
|McKenna, Mrs Rosemary
|Hodge, Ms Margaret
|Home Robertson, John
|Mandelson, Rt Hon Peter
|Howarth, Alan (Newport E)
|Marsden, Gordon (Blackpool S)
|Howarth, George (Knowsley N)
|Marsden, Paul (Shrewsbury)
|Howells, Dr Kim
|Marshall, David (Shettleston)
|Marshall, Jim (Leicester S)
|Hughes, Ms Beverley (Stretford)
|Hughes, Kevin (Doncaster N)
|Humble, Mrs Joan
|Meacher, Rt Hon Michael
|Iddon, Dr Brian
|Michael, Rt Hon Alun
|Ingram, Rt Hon Adam
|Michie, Mrs Ray (Argyll & Bute)
|Jackson, Ms Glenda (Hampstead)
|Milburn, Rt Hon Alan
|Jackson, Helen (Hillsborough)
|Moonie, Dr Lewis
|Johnson, Alan (Hull W & Hessle)
|Moran, Ms Margaret
|Johnson, Miss Melanie (Welwyn Hatfield)
|Morgan, Ms Julie (Cardiff N)
|Morgan, Rhodri (Cardiff W)
|Jones, Barry (Alyn & Deeside)
|Jones, Mrs Fiona (Newark)
|Morris, Rt Hon John (Aberavon)
|Jones, Helen (Warrington N)
|Jones, Ms Jenny (Wolverh'ton SW)
|Mowlam, Rt Hon Marjorie
|Jones, Jon Owen (Cardiff C)
|Jones, Dr Lynne (Selly Oak)
|Murphy, Denis (Wansbeck)
|Jones, Martyn (Clwyd S)
|Murphy, Jim (Eastwood)
|Jowell, Rt Hon Ms Tessa
|Murphy, Rt Hon Paul (Torfaen)
|Kaufman, Rt Hon Gerald
|Naysmith, Dr Doug
|Keeble, Ms Sally
|Keen, Alan (Feltham & Heston)
|O'Brien, Bill (Normanton)
|Keen, Ann (Brentford & Isleworth)
|O'Brien, Mike (N Warks)
|Kelly, Ms Ruth
|Kennedy, Jane (Wavertree)
|Khabra, Piara S
|Organ, Mrs Diana
|Osborne, Ms Sandra
|Palmer, Dr Nick
|King, Andy (Rugby & Kenilworth)
|King, Ms Oona (Bethnal Green)
|Kingham, Ms Tess
|Perham, Ms Linda
|Kumar, Dr Ashok
|Ladyman, Dr Stephen
|Pike, Peter L
|Lawrence, Ms Jackie
|Powell, Sir Raymond
|Lewis, Ivan (Bury S)
|Prentice, Ms Bridget (Lewisham E)
|Lewis, Terry (Worsley)
|Prentice, Gordon (Pendle)
|Liddell, Rt Hon Mrs Helen
|Lloyd, Tony (Manchester C)
|Quin, Rt Hon Ms Joyce
|Straw, Rt Hon Jack
|Stuart, Ms Gisela
|Reed, Andrew (Loughborough)
|Reid, Rt Hon Dr John (Hamilton N)
|Taylor, Rt Hon Mrs Ann (Dewsbury)
|Robertson, Rt Hon George (Hamilton S)
|Taylor, Ms Dari (Stockton S)
|Robinson, Geoffrey (Cov'try NW)
|Taylor, David (NW Leics)
|Roche, Mrs Barbara
|Thomas, Gareth (Clwyd W)
|Thomas, Gareth R (Harrow W)
|Ross, Ernie (Dundee W)
|Russell, Ms Christine (Chester)
|Ryan, Ms Joan
|Turner, Dennis, (Wolverh'ton SE)
|Turner, Dr Desmond (Kemptown)
|Turner, Dr George (NW Norfolk)
|Twigg, Derek (Halton)
|Twigg, Stephen (Enfield)
|Vis, Dr Rudi
|Walley, Ms Joan
|Shipley, Ms Debra
|Ward, Ms Claire
|Smith, Rt Hon Andrew (Oxford E)
|Whitehead, Dr Alan
|Smith, Angela (Basildon)
|Smith, Rt Hon Chris (Islington S)
|Williams, Rt Hon Alan (Swansea W)
|Smith, Miss Geraldine (Morecambe & Lunesdale)
|Williams, Alan W (E Carmarthen)
|Smith, Jacqui (Redditch)
|Williams, Mrs Betty (Conwy)
|Smith, John (Glamorgan)
|Smith, Llew (Blaenau Gwent)
|Southworth, Ms Helen
|Winterton, Ms Rosie (Doncaster C)
|Squire, Ms Rachel
|Starkey, Dr Phyllis
|Wright, Anthony D (Gt Yarmouth)
|Stewart, David (Inverness E)
|Wright, Dr Tony (Cannock)
|Stoate, Dr Howard
|Teller for the Ayes:
|Mr. Mike Hall and
|Strang, Rt Hon Dr Gavin
|Mr. Clive Betts.
|Arbuthnot, Rt Hon James
|Ashdown, Rt Hon Paddy
|Chapman, Sir Sydney
|Atkinson, David (Bour'mth E)
|Atkinson, Peter (Hexham)
|Beith, Rt Hon A J
|Beresford, Sir Paul
|Cormack, Sir Patrick
|Body, Sir Richard
|Bottomley, Rt Hon Mrs Virginia
|Davey, Edward (Kingston)
|Davies, Quentin (Grantham)
|Brand, Dr Peter
|Davis, Rt Hon David (Haltemprice & Howden)
|Brooke, Rt Hon Peter
|Browning, Mrs Angela
|Duncan Smith, Iain
|Bruce, Malcolm (Gordon)
|Emery, Rt Hon Sir Peter
|Cable, Dr Vincent
|Campbell, Rt Hon Menzies
|Forth, Rt Hon Eric
|Foster, Don (Bath)
|Fowler, Rt Hon Sir Norman
|Gillan, Mrs Cheryl
|Gorman, Mrs Teresa
|Redwood, Rt Hon John
|Robertson, Laurence (Tewk'b'ry)
|Hamilton, Rt Hon Sir Archie
|Ross, William (E Lond'y)
|Rowe, Andrew (Faversham)
|Russell, Bob (Colchester)
|Heath, David (Somerton & Frome)
|Hogg, Rt Hon Douglas
|Howarth, Gerald (Aldershot)
|Simpson, Keith (Mid-Norfolk)
|Hughes, Simon (Southwark N)
|Smyth, Rev Martin (Belfast S)
|Jack, Rt Hon Michael
|Spicer, Sir Michael
|Jackson, Robert (Wantage)
|Johnson Smith, Rt Hon Sir Geoffrey
|Jones, Nigel (Cheltenham)
|Tapsell, Sir Peter
|Kennedy, Charles (Ross Skye)
|Taylor, Ian (Esher & Walton)
|Taylor, Sir Teddy
|King, Rt Hon Tom (Bridgwater)
|Kirkbride, Miss Julie
|Tonge, Dr Jenny
|Laing, Mrs Eleanor
|Lait, Mrs Jacqui
|Lewis, Dr Julian (New Forest E)
|Lilley, Rt Hon Peter
|Lloyd, Rt Hon Sir Peter (Fareham)
|Lyell, Rt Hon Sir Nicholas
|Whitney, Sir Raymond
|McIntosh, Miss Anne
|Widdecombe, Rt Hon Miss Ann
|MacKay, Rt Hon Andrew
|Maclean, Rt Hon David
|Winterton, Mrs Ann (Congleton)
|Maude, Rt Hon Francis
|Winterton, Nicholas (Macclesfield)
|Mawhinney, Rt Hon Sir Brian
|May, Mrs Theresa
|Michie, Mrs Ray (Argyll & Bute)
|Young, Rt Hon Sir George
|Tellers for the Noes:
|Mr. Tim Collins and
|Mr. Oliver Heald.
§ Question accordingly negatived.
§ Question put, That the remaining Government amendments be made:—
§ The House divided: Ayes 381, Nose 153.1325
§ Question accordingly agreed to.