HC Deb 28 January 2002 vol 379 cc18-20
11 Mr. Crispin Blunt (Reigate)

What targets his Department has to increase private pension provision. [28151]

The Minister for Pensions (Mr. Ian McCartney)

As I said in November—it seems such a long time ago.[Laughter.] A civil servant with a sense of humour. As I said in November, we are committed to encouraging private saving to meet the long-term challenges of an ageing population, and we remain committed. That is why we are introducing the pension credit, making sure that it pays to save, and why we have introduced stakeholder pensions, which are a secure, value-for-money method of making private provision. We have launched the simplification review to reduce the layers of regulation which increase costs; we have replaced the minimum fund requirement; and we are implementing the recommendation of the Myners review. Our pension education campaign is driving home the message that saving now is the best way to guarantee security tomorrow.

Mr. Blunt

I think that that means the Minister accepts that the success of private pension provision is an essential national economic interest, not only for the future wealth of pensioners but because it has to date given the United Kingdom vastly more resources to invest in the UK and around the world than are available to equivalent countries in the European Union. All that is threatened by the triple whammy of increased regulation, the taxation of pensions and the fall in annuity rates. Does the Minister accept that if policy does not change, we will be on our way to a long-term calamity of missed opportunity in this area?

Mr. McCartney

As far back as the 1960s, generations of colleagues on this side of the House have been in favour of a robust private sector. I remind the hon. Gentleman that the last Conservative Administration, rather than bolstering savings for pensions, got involved in the mis-selling of tens of thousands of pounds worth of policies. It has taken this Government to replace that resource because of what the Conservatives did and the shambles that they left behind.

As I said in my earlier reply, we are sympathetic on regulation, which is why we have set up the Pickering review. We are sympathetic about changes in the market, which is why the Sandler review has been set up. Not only are we sympathetic but we want to work with the industry, which is why both reviews are very open to the industry and the organisations that represent current and future pensioners. At last we have a Government who have a long-term vision for pensions, both in the public and the private sector.

Paul Holmes (Chesterfield)

What measures will the Government take to deal with the abuse of final salary pension schemes? In the past eight months, workers at two companies in my constituency have discovered that their final salary schemes have become almost worthless. Last week, in an Adjournment debate, we heard about the problems that have arisen throughout the country concerning United Engineering Forgings, which has gone through exactly the same process, along with five or six other companies including Chesterfield Cylinders in my constituency. No laws were broken; it was effectively legalised robbery of private final salary pension schemes into which my constituents had paid, in some cases for up to 35 years, only to find that most of their money had gone when it came to the pension scheme paying out. That has also happened to other firms—

Mr. Speaker


Mr. McCartney

I suggest that the hon. Gentleman puts in for an Adjournment debate, so that we can openly debate the specific circumstances. If he wants to raise issues concerning a particular company, he is welcome to write to me. We take strong action on these matters, which is why we have OPAS, the Office of the Pensions Advisory Service, and OPRA, the Occupational Pensions Regulatory Authority, and we have set up a quinquennial review on pensions. We are committed to ensuring that we assist pensioners by trying to rub out fraud wherever it takes place.

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