HC Deb 25 November 2002 vol 395 cc12-3
11. Mr.Laurence Robertson (Tewkesbury)

If he will make a statement on the take-up of stakeholders pensions since their inception. [81279]

The Minister for Pensions (Mr. Ian McCartney)

Figures from the Association of British Insurers show that up to the end of September 2002, 1,151,371 stakeholder pensions had been sold. A detailed breakdown of sales will be available around the middle of next year. Sales of more than 1 million in their first 18 months on the market represents a very encouraging start.

Mr. Robertson

I thank the Minister for that response. How many of those are people who have transferred their pensions to stakeholder schemes from other schemes? If they have, the figure does not reflect a net increase in the number of people who hold pensions. How does he intend to address the crisis in the industry given the catalogue of errors, outlined by my Front-Bench colleagues, that the Government have introduced?

Mr. McCartney

The hon. Gentleman has not changed since he stood against me in 1987, when he was shown the door.

Mr. John Bercow (Buckingham)

He has: he has got a seat.

Mr. McCartney

Nice one, but I was talking about the attitude of the hon. Member for Tewkesbury (Mr. Robertson) rather than his seat.

Some 97 per cent. of the sales have been made to people of working age and half of them have been sold via the workplace. It is a significant increase in pension provision. Before stakeholder pensions, some people had no opportunity, either with their employer or not, to save for a pension.

The record of the previous Government was different—£13.5 billion of mis-sold pensions to workers. The present Government resolved that and went on to introduce something else—the stakeholder pension. More than 1 million people who did not have a pension 18 months ago have one now.

Mr. Jim Cousins (Newcastle upon Tyne, Central)

In April this year, the Government introduced the earnings-related state second pension, the best pension deal for low-paid workers that has ever been on offer in the history of British pensions. The Government promised that it would remain in force until there was a take-up of millions of stakeholder pensions in the target group of low to middling incomes. That target is not being achieved. Will that promise be kept? Can we look forward to the continuation of the earnings-related state second pension?

Mr. McCartney

I am surprised that my hon. Friend should say that the Government are not pursuing with vigour the issues around stakeholders and the second state pension. He is absolutely right—the state second pension has been a tremendous fillip for 14 million low-paid workers, 2 million people with disabilities who have work records that kept them out of the basic state pension previously, and 2 million carers. Most of the recipients are women, which is a major step forward. We have not gone to the trouble of taking such step only to reduce later our capacity to make it one of the most effective measures introduced by any Government.

Mrs. Angela Browning (Tiverton and Honiton)

I note that the Minister did not quite answer my hon. Friend the Member for Tewkesbury (Mr. Robertson), who asked how many people who had signed up for stakeholders had transferred out of another scheme. Perhaps he would like to have another go. I know how interested he is in hearing how things are at the grass roots. Certainly, lower-paid workers in my constituency are not signing up because they do not want to commit their savings to the final compulsory annuity. Will the Minister take a look at the difference between the state of the pensions market now and in 1997? One of the great destructive things the Government have done is to take away the incentive for people to invest. The compulsory annuity scheme is part of the problem. Will the Minister take a second look at that?

Mr. Speaker

Order. The hon. Lady should perhaps try for an Adjournment debate on the subject.

Mr. McCartney

I hope that it is not me who has to reply—[Laughter.] I like the hon. Lady really.

If the hon. Lady had listened to my reply to the hon. Member for Tewkesbury (Mr. Robertson), she would have heard that a detailed breakdown of sales would he available around the middle of next year. That is a movable feast, but the important fact is that more than 1 million stakeholders have been sold. Another vital figure relates to the fact that 97 per cent. of sales have been to people of working age, so the initiative has been a tremendous success. Why cannot Opposition Members, whether from the Liberal or Conservative party, get behind a proposal to provide for people who, without stakeholders, would not have a future in pensions?