HC Deb 09 February 2004 vol 417 cc1104-5
4. Kevin Brennan (Cardiff, West) (Lab)

What plans he has to permit employers to compel employees to join final salary occupational pension schemes. [153173]

The Secretary of State for Work and Pensions (Mr. Andrew Smith)

The Government have no such plans. The independent Pensions Commission is examining whether greater compulsion is advisable. As we set out last week, we are looking at whether it makes sense to promote more general use of schemes that automatically enrol employees unless they chose to opt out and at how we can best ensure that an individual's decision to join or not to join an occupational pension is based on good information.

Kevin Brennan

I thank the Secretary of State for that answer. When my father joined the steel industry, he was compelled to join a final salary occupational scheme and, fortunately, that has seen him well in retirement. The Allied Steel and Wire workers were similarly compelled to join an occupational pension scheme. When people ask me, "Would you let what has happened to the ASW workers happen to your own father?" my answer is an unequivocal no. What would the Secretary of State's answer be to the same question?

Mr. Smith

I would share my hon. Friend's concern for the plight of those affected, as the Minister for Pensions, other ministerial colleagues and I have made clear on many occasions. I pay tribute to my hon. Friend's energy and commitment in campaigning on behalf of those who have lost out because of company insolvency. As he knows, we have been examining whether anything might be done, without wanting to raise false hope, and as soon as I am able to report further to the House I will do so.

Mr. Derek Wyatt (Sittingbourne and Sheppey) (Lab)

As the Secretary of State knows, I am interested in ASW—ASW Sheerness is in my constituency—along with my hon. Friend the Member for Cardiff, West (Kevin Brennan) and the hon. Member for Twickenham (Dr. Cable), who asked a question that was similar to questions that we have been asking in the House for the past couple of months: how do we get to the bottom of how many people's pension schemes are in deficit? If my right hon. Friend introduces a retrospective measure—we hope that he will—how will he know that it will cover everyone if there are differences of opinion between the Treasury, the Office of the Pensions Advisory Service and other groups?

Mr. Smith

As my hon. Friend suggests, identifying precisely who has lost out in that way is one of the many dimensions of difficulty to this very challenging issue. As I said when he last raised this, other issues include how to differentiate between some who have lost out and others who have lost out in respect of eligibility; whether it is right to use taxpayers' money—let us remember that half of taxpayers are not members of occupational pensions schemes—to give extra help to that group; the risk of raising expectations that taxpayers stand behind private savings and pensions as a whole; and, not least, the risk of prejudicing the legal action that has been taken already. I mention hose matters to show that we are carefully looking at the issue—including, as my hon. Friend points out, at the numbers affected—but I am not able today to say what the conclusion of that examination is.

Back to