HC Deb 12 November 2001 vol 374 cc568-70
17. Mr. Andrew Rosindell (Romford)

What targets his Department has to encourage private pension provision. [11698]

The Minister for Pensions (Mr. Ian McCartney)

We are committed to encouraging private saving to meet the long-term demographic challenge of an ageing population. We believe that everyone who can save for their retirement has a responsibility to do so, and that saving should be rewarded. Through stakeholder pensions schemes, we are targeting moderate and high earners without access to a good occupational scheme or a cost-effective personal pension. Stakeholder pensions offer those with current provision a secure, value-for-money and flexible savings vehicle.

The new pension credit will ensure that savings pay, targeting those with modest pensions or savings. It will support state second pensions and stakeholder pensions by providing those with low incomes and modest pensions with a cash top-up. The simplification review led by Alan Pickering will target the layers of regulation that increase compliance costs for employers and providers, possibly making pension provision expensive or confusing. The review will report in July with recommendations.

Mr. Rosindell

I thank the Minister for his reply. However, does he accept that many younger people are concerned about whether the existing provision will help them in years to come? Many younger people will obviously depend purely on a private pension. Does he accept that the Government need to do a great deal more if that is to be sustained?

Mr. McCartney

I agree with the hon. Gentleman that we must ensure that we sustain our education campaign so that every individual in the community of working age takes some responsibility for long-term savings. The problem is that when we spend resources on doing that, the Conservative party complains. However, we will continue to do so.

It is important that, throughout people's working lives, we provide them with savings and pensions platforms. People have different needs from time to time. Until now, at any event, younger people have not seen the necessity to save for their old age. Through various vehicles and our educational campaign, we are trying to get young people not only to think about their old age but to start saving through appropriate vehicles.

We also need to look after the many people who have disabilities or are carers. The state second pension will be introduced to ensure that those with broken work records, for example, such as young people with disabilities, have the opportunity of a reasonable income when they retire.

Paul Flynn (Newport, West)

Is not the cheek of the Opposition breathtaking? They are the party who brought in private pensions and who bribed and conned 6 million people out of safe occupational schemes, and now those people find that they are losing out badly. Young people know that they are immortal and will never grow old, so is not the only way to ensure that they have a pension to set up a safe, secure scheme that is compulsory and run by the state?

Mr. McCartney

I listened to my hon. Friend. This Government have reviewed and modernised the pensions system, and introduced stakeholder pensions, second state pensions and pension credits so that when people get to pension age, rather than facing a life of poverty as they would have done under the Conservatives, they have an income and are treated with dignity and respect.