PROHIBITION ON DIFFERENT RULES FOR OVERSEAS RESIDENT ETC. (Hansard, 24 July 2000)

§ Mr. Rooker
I beg to move, That this House agrees with the Lords in the said amendment.

§ Mr. Deputy Speaker
With this we may discuss Lords amendments Nos. 20 to 22, 59 and 60.

§ Mr. Rooker
The amendments were tabled at the last minute, and it is fair to explain briefly why.
814 Amendments Nos. 19 to 22 would provide a power to make regulations that may specify exemptions to the current provisions of clause 54. Amendments Nos. 59 and 60 would delay the commencement of the clause by amending clause 83. The amendments relate to directive 98/49/EC, and are designed to safeguard the occupational pension rights of workers who move to other member states of the European Union.
The Government supported the directive because it protects workers who have occupational pension rights, and wish to exercise their rights to move freely in the European Union. The directive extends good practice that already applies in the United Kingdom to the treatment of occupational pensions throughout the European Union. It therefore promotes labour mobility in the EU. The terms of the directive state that provisions to implement it must be included in domestic legislation by July 2001.
When the directive was adopted, the Government's understanding, which was based on extensive consultation with the pensions industry in the United Kingdom and elsewhere in the European Union, was that UK schemes already complied with its provisions. During the Bill's passage through the other place, we were alerted to the practice of a small number of UK schemes that pay annual increases in pensions based on the rate of inflation of the country of residence, not that of the UK. That point was never raised during consideration of the directive.
We have tabled the amendments to avoid UK legislation causing UK schemes to be in breach of current UK law, even though the directive might not be breached. I can give further and better particulars if the House desires. The amendments have been tabled to include in UK law provisions that, because we did not know about the few schemes whose practice is slightly different from most pension schemes, we believed already operated.

§ Mrs. Lait
I shall be brief. I congratulate the Government on listening to pension industry worries so late in the day when the problem was identified. It is perhaps a lesson to us all that no one should introduce legislation at the last minute, before it has been thoroughly discussed with all the relevant groups.
We do not want to hold up the amendment, and we are glad that there is time for matters to be rectified and for necessary action to be taken. However, the lesson that needs to be learned is that EU directives need long and careful consultation. A new pensions directive is floating around; I sincerely hope that we shall not experience the same problems with it.