Browse content similar to 22/03/2017. Check below for episodes and series from the same categories and more!
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Order. Urgent question. To ask the Secretary of State for Transport if | :00:00. | :00:19. | |
he will make a statement on recent changes to aviation security. | :00:20. | :00:22. | |
Secretary of State for Transport, Secretary Chris Grayling. The safety | :00:23. | :00:25. | |
and security of the travelling public will always be paramount | :00:26. | :00:29. | |
concern and this government will not hesitate in putting in place any | :00:30. | :00:33. | |
measures we believe are necessary, effective and proportionate. That is | :00:34. | :00:37. | |
why yesterday we took the decision to step up some of our aviation | :00:38. | :00:42. | |
security measures in response to potential threats to aviation as set | :00:43. | :00:46. | |
out in a written ministerial statement yesterday afternoon. | :00:47. | :00:49. | |
These new measures will be applied to all inbound direct flights to the | :00:50. | :00:54. | |
United Kingdom from Turkey, Lebanon, Jordan, Egypt, Tunisia and Saudi | :00:55. | :00:57. | |
Arabia. We have explained this decision at all levels with our | :00:58. | :01:07. | |
partners in the region. We have also spoken to European partners such as | :01:08. | :01:09. | |
Germany and France with significant interest in aviation and other | :01:10. | :01:11. | |
partners elsewhere whose travellers and carriers may be affected. The | :01:12. | :01:14. | |
House will be aware the US government made a similar | :01:15. | :01:17. | |
announcement shortly before regarding the rights to the United | :01:18. | :01:20. | |
States and we have been in close contact with them to fully | :01:21. | :01:22. | |
understand their position. Whilst the United Kingdom has some of the | :01:23. | :01:26. | |
most robust security measures in the world, we can never be complacent. | :01:27. | :01:31. | |
That is why we continue to work in conjunction with our international | :01:32. | :01:35. | |
partners and the wider aviation industry, to keep security under | :01:36. | :01:39. | |
constant review. And to ensure that when you | :01:40. | :01:52. | |
measures are done so in a way that can keep the level of disruption it | :01:53. | :01:57. | |
may cause to passengers to a minimum. Passengers boarding flights | :01:58. | :01:59. | |
to the United Kingdom from the countries I've just listed will not | :02:00. | :02:01. | |
be allowed to take any phones, laptops and tablets larger than a | :02:02. | :02:03. | |
normal sized mobile phone. This is to assist both airlines and | :02:04. | :02:05. | |
passengers. A length of 16 centimetres, width of 9.3 and a | :02:06. | :02:10. | |
depth of 1.5 centimetres. Passengers are advised to take some simple | :02:11. | :02:14. | |
steps that check-in to prepare, by placing these personal electronic | :02:15. | :02:18. | |
devices into their hold luggage before going Central 's security. | :02:19. | :02:22. | |
Normal cabin luggage restrictions will apply. Passengers should check | :02:23. | :02:27. | |
on the line for further information. My department is working | :02:28. | :02:30. | |
round-the-clock with the industry to ensure that passengers get the | :02:31. | :02:33. | |
information they need, when and where they need it. While we would | :02:34. | :02:39. | |
do everything we can to minimise the disruption to people's journeys, we | :02:40. | :02:42. | |
do understand the frustration this may cause, but he will understand | :02:43. | :02:46. | |
that our top priority will always be to ensure that public safety is | :02:47. | :02:51. | |
maintained. Mr Speaker, these new measures are concerned with flights | :02:52. | :02:55. | |
into the United Kingdom. The UK is not advising against flying to and | :02:56. | :02:59. | |
from these countries. Those with Immonen travel should contact their | :03:00. | :03:04. | |
airline for further information. -- with Immonen travel. | :03:05. | :03:10. | |
UK airports have been informed and my officials have asked them to | :03:11. | :03:14. | |
consider stepping up their own contingency arrangement should they | :03:15. | :03:17. | |
be needed. I know the whole house will recognise the fact that we face | :03:18. | :03:21. | |
a constantly evolving threat from terrorism and must respond | :03:22. | :03:24. | |
accordingly to ensure the protection of the public against those who | :03:25. | :03:27. | |
would do us harm. The changes we are making to our security measures are | :03:28. | :03:31. | |
an important part of that process and I assure the House we will | :03:32. | :03:35. | |
continue to work closely with airlines, airports and the wider | :03:36. | :03:39. | |
travel industry in the coming weeks to ensure passengers know what is | :03:40. | :03:49. | |
expected of them. I ask for their patience as these new measures bed | :03:50. | :03:51. | |
in. Mr Speaker, I will continue to keep the House updated on | :03:52. | :03:54. | |
developments. This is a major change to our aviation security regulations | :03:55. | :03:57. | |
and carries with it serious potential for delay and confusion | :03:58. | :04:02. | |
for UK passengers. First they a minister explained why the UK and US | :04:03. | :04:05. | |
ban were announced within hours of one another, yet provide for | :04:06. | :04:10. | |
different countries, airlines and in effect different devices? The United | :04:11. | :04:14. | |
Arab Emirates, Kuwait and Morocco are countries all affected by the US | :04:15. | :04:21. | |
ban but not included in the UK's. No US operator is affected but six | :04:22. | :04:26. | |
British airlines are. Size restrictions on electric items | :04:27. | :04:29. | |
differ between the two. The Washington Post reports that US | :04:30. | :04:32. | |
officials have been discussing new restrictions for over a fortnight. | :04:33. | :04:36. | |
When exactly did ministers first learn of these potential changes? | :04:37. | :04:40. | |
Does he agree that to avoid passenger confusion and delay on | :04:41. | :04:44. | |
effort should be made to harmonise these and for what specific reasons | :04:45. | :04:47. | |
did he exclude fewer countries than the US? | :04:48. | :04:53. | |
Passengers presently booked to fly from an affected airport are unclear | :04:54. | :04:59. | |
about what the band will mean in practice. For those who fly on the | :05:00. | :05:04. | |
hand baggage only fares, what procedures are in place to | :05:05. | :05:07. | |
communicate changes before turning up to security at a busy airport? | :05:08. | :05:14. | |
Will UK passengers have to buy luggage to carry electronic devices? | :05:15. | :05:17. | |
What discussions has he had with insurers, who do not routinely cover | :05:18. | :05:23. | |
electronics carriage in the hold and what assessment has he made in | :05:24. | :05:28. | |
regard of theft and damage to devices? Efficacy, have restrictions | :05:29. | :05:32. | |
been put in place in response to specific threats that differs in | :05:33. | :05:40. | |
nature to the Al-Shabab attack that took place more than a year ago and | :05:41. | :05:43. | |
did not result in the loss of an aircraft. Have these measures be | :05:44. | :05:49. | |
made in addition and what evidence does he have in placing problematic | :05:50. | :05:56. | |
items in the hold is safer than the capping, especially with devices | :05:57. | :06:04. | |
with lithium ion batteries? Aviation security is under constant review, | :06:05. | :06:08. | |
can he assure us that all has been done to make sure regulations are | :06:09. | :06:12. | |
effective, consistent, and put the passenger first? We respond in | :06:13. | :06:22. | |
aviation security to the evolving threat we face from terrorists. | :06:23. | :06:31. | |
There are some things that we don't and I will not give him full details | :06:32. | :06:36. | |
of the background to the decision taken, it is in response to an | :06:37. | :06:40. | |
evolving threat and he would not expect me to do that but we have | :06:41. | :06:44. | |
taken steps we have taken for good reason. In terms of differences | :06:45. | :06:50. | |
between the United Kingdom and United States approach, their | :06:51. | :06:53. | |
approaches for them. What we have done is consider evolving | :06:54. | :06:59. | |
information, reached the decision about what we believe is in the | :07:00. | :07:03. | |
interest of the UK and protection of citizens. He asked about why this | :07:04. | :07:10. | |
does not affect UK... US operators and the answer is they do not | :07:11. | :07:14. | |
currently fly to destinations affected and other airlines do. We | :07:15. | :07:20. | |
have applied our change to the requirements on airlines, to all | :07:21. | :07:23. | |
airlines that fly the route, UK and non-UK. This is a matter we keep | :07:24. | :07:30. | |
under review and have done for some time and we have taken the decision | :07:31. | :07:35. | |
because we believe it is the right one to take against a background of | :07:36. | :07:40. | |
the evolving threat. He asked about hand baggage only and that is a | :07:41. | :07:43. | |
matter for the airlines to resolve. We have been in discussion with them | :07:44. | :07:47. | |
as they are preparing to implement the change and it will be for them | :07:48. | :07:53. | |
to establish how to handle bat in context of passengers booked in hand | :07:54. | :07:57. | |
baggage only and it will be a matter for the individual airline to decide | :07:58. | :08:03. | |
how to do it. Insurance, I will write to the association of British | :08:04. | :08:07. | |
insurers to ask them to be mindful. He makes an important point about | :08:08. | :08:11. | |
the risk of theft. We will ask the industry to be careful to take that | :08:12. | :08:16. | |
into account and be realistic about this. Otherwise, we have taken the | :08:17. | :08:25. | |
decision we have taken in a way we believe is necessary to protect the | :08:26. | :08:29. | |
safety of UK passengers, but he will understand that the background to | :08:30. | :08:36. | |
every decision of this kind inevitably is not based on matters | :08:37. | :08:39. | |
we can automatically put into the public arena. | :08:40. | :08:48. | |
Having just returned from a police cancelled trip we saw the effect on | :08:49. | :08:53. | |
the economy in Egypt on the continuing ban on flights to region | :08:54. | :09:00. | |
and we met first-hand with the Egyptians and they have concerns | :09:01. | :09:03. | |
they are singled out in some way, which might be the reaction of other | :09:04. | :09:09. | |
allies made today. Will he commit to discussing with other ministers a | :09:10. | :09:13. | |
diplomatic offensive to go to these countries and explain why these | :09:14. | :09:16. | |
actions are being taken and they are not being single that? Will he | :09:17. | :09:24. | |
liaise with his colleague in the Department for International | :09:25. | :09:26. | |
Development to provide extra assistance to these countries at | :09:27. | :09:29. | |
their airports because this will cause further disruption and some | :09:30. | :09:34. | |
have not got the capacity to introduce a new security measure? I | :09:35. | :09:38. | |
can give him a categoric assurance we are already in dialogue with | :09:39. | :09:43. | |
those countries. That we will take care to ensure we do everything to | :09:44. | :09:49. | |
help at the other end at their airports. We already cooperate | :09:50. | :09:56. | |
closely. This is not a question of singling out countries. We would | :09:57. | :10:00. | |
never embark upon a process of singling out countries. The | :10:01. | :10:03. | |
decisions we take our taken on the basis of what we believe the risks | :10:04. | :10:09. | |
are and where we believe we need to take steps to protect UK citizens. | :10:10. | :10:17. | |
Safety must of course be the priority but there are too many | :10:18. | :10:20. | |
loose ends here. Does the government have evidence the security risks to | :10:21. | :10:25. | |
flights from the countries listed are greater than those on flights | :10:26. | :10:31. | |
other countries, otherwise why have flights from these countries alone | :10:32. | :10:37. | |
been targeted? Why have the UK and USA apparently reached different | :10:38. | :10:41. | |
conclusions, I assume from the same intelligence, about the countries | :10:42. | :10:46. | |
from which in cabin electronics present the greatest risk, or of the | :10:47. | :10:50. | |
differences about something other than intelligence? If the presence | :10:51. | :10:55. | |
of electronics on aircraft flying from countries listed is a security | :10:56. | :10:58. | |
threat, why are there no restrictions on electronics in hold | :10:59. | :11:04. | |
baggage from those countries? What thought has been given to people | :11:05. | :11:08. | |
carrying electronics on board who change planes in countries not | :11:09. | :11:15. | |
affected? What liaison has there been with the countries listed with | :11:16. | :11:19. | |
countries not listed and with airlines, all of whose confidence | :11:20. | :11:22. | |
and cooperation will be crucial to the effectiveness of the measures | :11:23. | :11:27. | |
introduced? What action is he taking to ensure passengers get clear | :11:28. | :11:32. | |
information about what they are and are not allowed to take on board, to | :11:33. | :11:39. | |
ensure delays are minimised? Safety has to be the priority but there | :11:40. | :11:44. | |
really are too many loose ends. If there really are security grounds | :11:45. | :11:49. | |
for the restrictions he has introduced, he has to be clearer | :11:50. | :11:52. | |
about what those security grounds are, otherwise both the UK | :11:53. | :11:57. | |
Government and US government will remain open to suspicion that they | :11:58. | :12:03. | |
are unreasonably singling out countries in the Middle East and | :12:04. | :12:07. | |
North Africa, rather than thinking through properly what precautions | :12:08. | :12:12. | |
can actually keep flights safe from terrorism, wherever the aircraft fly | :12:13. | :12:18. | |
from. I have to take issue with the last point. The party opposite was | :12:19. | :12:23. | |
in power 13 years and his predecessors on the front bench | :12:24. | :12:26. | |
understood there are things we cannot set out in public that lie | :12:27. | :12:31. | |
behind decisions taken in the interests of passengers. That has | :12:32. | :12:39. | |
not changed through all the years. I understand his desire for | :12:40. | :12:43. | |
information, but the reality is we have an evolving security threat to | :12:44. | :12:48. | |
aircraft, we take decisions when we believe necessary, to protect | :12:49. | :12:51. | |
citizens. It is nothing to do with singling out countries nor what the | :12:52. | :12:57. | |
destinations are, the decisions we take are purely and simply based on | :12:58. | :13:01. | |
an evolving security threat and what we believe is the right way to | :13:02. | :13:07. | |
protect UK citizens. The US administration will take its | :13:08. | :13:10. | |
decisions about how to protect its citizens. We do not always have to | :13:11. | :13:15. | |
take the same decisions on behalf of both countries. We have done what we | :13:16. | :13:19. | |
think is right for the UK. You've raised other points. Transfer | :13:20. | :13:24. | |
passengers, the rules will apply to transfer passengers. As is the case | :13:25. | :13:30. | |
now, they will normally go through a further security check and subject | :13:31. | :13:35. | |
to the same gate checks and if they have a laptop, tablet, a large sized | :13:36. | :13:41. | |
phone, it will be placed in the hold. The airlines individually are | :13:42. | :13:48. | |
working with our support to provide the best information to passengers, | :13:49. | :13:52. | |
as will the Foreign Office and government agencies that play a role | :13:53. | :13:57. | |
but first and foremost our priority in response to a security threat is | :13:58. | :14:01. | |
to provide the best protection for citizens. Why are they safe in the | :14:02. | :14:11. | |
hold? As I said and I hate to be | :14:12. | :14:18. | |
disingenuous in terms of repeating answers, but I cannot discuss the | :14:19. | :14:22. | |
detail of that evolving security threat. We have taken what we | :14:23. | :14:26. | |
believe is the right decision in the interests of protecting citizens. | :14:27. | :14:36. | |
We cannot second-guess the security intelligence the government has | :14:37. | :14:40. | |
received and the safety of citizens is the primary concern of the SNP | :14:41. | :14:45. | |
and Scottish Government, who will work closely with UK Government to | :14:46. | :14:49. | |
ensure proportionate measures are in. Can I ask him what discussions | :14:50. | :14:56. | |
have taken place with the Scottish Government and did those include a | :14:57. | :15:00. | |
commitment to keep them and transport Scotland up to date with | :15:01. | :15:06. | |
events? Will those who are impacted by booking previously just with hand | :15:07. | :15:12. | |
baggage, who may be facing extra charges, have mitigation put in | :15:13. | :15:17. | |
place or compensation, and finally, what additional resources will be | :15:18. | :15:21. | |
available to UK airports if required to take forward these measures? | :15:22. | :15:32. | |
On that latter point, the impact on UK airports is not an immediate one | :15:33. | :15:37. | |
because these new rules do not apply to UK airports but we have asked | :15:38. | :15:40. | |
them to think practically ahead in case matters change. In terms of | :15:41. | :15:47. | |
liaison with the Scottish Government, the minister for | :15:48. | :15:50. | |
aviation and officials were in contact with the Scottish Government | :15:51. | :15:55. | |
yesterday and the Scottish minister and my honourable friend have yet to | :15:56. | :15:59. | |
fix a time to speak book will do so today and we will keep the Scottish | :16:00. | :16:03. | |
Government informed. With regard to people who booked hand baggage only, | :16:04. | :16:09. | |
we have been in discussion with airlines and we expect the airlines | :16:10. | :16:12. | |
will work a system that ensures people are not worse off as a result | :16:13. | :16:17. | |
of the changes. I commend my right honourable friend | :16:18. | :16:23. | |
for ensuring the paramount importance of our national security | :16:24. | :16:27. | |
and safety of British citizens travelling. Gatwick Airport in my | :16:28. | :16:37. | |
constituency, I am also grateful for him talking with the airport | :16:38. | :16:41. | |
authorities and tour operators in my constituency. Can I seek assurances | :16:42. | :16:46. | |
he will continue to keep them involved as this evolving situation | :16:47. | :16:50. | |
develops? I can give him that guarantee. We | :16:51. | :16:57. | |
are talking to the industry as a whole and it is my hope we won't end | :16:58. | :17:01. | |
up having to take further steps but we need to be mindful of the | :17:02. | :17:06. | |
evolving security threat and security of British passengers will | :17:07. | :17:14. | |
be top of our priority list. I am reassured security is paramount | :17:15. | :17:19. | |
and it must remain so, but could the minister please clarify exactly how | :17:20. | :17:23. | |
passengers will know what arrangements they have to make for | :17:24. | :17:26. | |
individual journeys and is he still looking at the situation at overseas | :17:27. | :17:31. | |
airports where it is known there are security concerns? | :17:32. | :17:37. | |
We have a widespread effort to ensure we provide protection to | :17:38. | :17:42. | |
citizens in the UK and when they are in other countries. We do extensive | :17:43. | :17:48. | |
security liaison work with other countries including the region | :17:49. | :17:53. | |
affected, and I am grateful to all countries we work with for the | :17:54. | :17:56. | |
cooperation and support they provide. It is in all our interests | :17:57. | :18:02. | |
we continue to maintain aviation and tourist flows and to provide | :18:03. | :18:07. | |
economic benefits to all parties that good aviation brings and we | :18:08. | :18:11. | |
will do everything to work with partners to ensure we have a safe | :18:12. | :18:13. | |
and aviation sector as we can. I think we all accept circumstances | :18:14. | :18:21. | |
change and threats will change over time. Could the minister confirm | :18:22. | :18:25. | |
whether or not there is a time limit to these changes and is there a | :18:26. | :18:28. | |
specific date when they will be reviewed? | :18:29. | :18:32. | |
In terms of time limits... The change will be implemented, going | :18:33. | :18:37. | |
forward from now by the airlines. They are being asked to have that | :18:38. | :18:41. | |
changes in place within a very short period of time. They and we will | :18:42. | :18:46. | |
have a communication job to do to people returning who will be | :18:47. | :18:49. | |
affected by this, there is a need to do that well. In terms of time | :18:50. | :18:53. | |
limits, we hope this is a temporary measure but we will keep it on under | :18:54. | :18:57. | |
review and keep these measures in place as long as they are necessary | :18:58. | :18:59. | |
to secure the safety of our passengers. | :19:00. | :19:03. | |
I accept the Secretary of State may not be able to answer these two | :19:04. | :19:06. | |
questions, but why does this only apply to direct flights? Are other | :19:07. | :19:11. | |
countries under active consideration to be added to the list? | :19:12. | :19:17. | |
I think all I can honestly say in response to the questions is we keep | :19:18. | :19:22. | |
these issues under constant review. The decisions taken this week we | :19:23. | :19:26. | |
believe are the right ones, in the face of the evolving terrorist | :19:27. | :19:30. | |
threat. Thank you Mr Speaker. I think the | :19:31. | :19:34. | |
Secretary of State for his update. Many of my constituents working at | :19:35. | :19:43. | |
NATS, for those starting their journeys at regional airports, how | :19:44. | :19:46. | |
will the communication start Tommy 's journeys? | :19:47. | :19:50. | |
It will be very much the responsibility of the airlines going | :19:51. | :19:53. | |
forward to explain this. We will provide whatever support to them. | :19:54. | :19:56. | |
Perhaps if I could extend my thanks to all those people in the UK | :19:57. | :20:01. | |
airlines and international airlines, with whom my department has been | :20:02. | :20:04. | |
working in the last few days. They have been enormously helpful and | :20:05. | :20:08. | |
cooperated in what is a difficult change for them and I think we | :20:09. | :20:13. | |
should be very grateful to them. Can I ask the Secretary of State | :20:14. | :20:16. | |
about flights from this country... Is he confident that if a terrorist | :20:17. | :20:23. | |
try to get a laptop or an iPad onto a plane here they would be detected | :20:24. | :20:27. | |
and there would be absolutely no chance of getting it throughout | :20:28. | :20:31. | |
security? Well, Mr Speaker, our airports and | :20:32. | :20:34. | |
security industry I believe are among if not the best in the world. | :20:35. | :20:39. | |
I think we should be proud of how well our airports are protected. | :20:40. | :20:42. | |
What I would say to him is the decisions that we take and will take | :20:43. | :20:46. | |
in the future will be based upon our assessment of what is necessary at | :20:47. | :20:50. | |
any particular time, and our judgment is the changes we are | :20:51. | :20:53. | |
making today is what is necessary at this moment in time given the | :20:54. | :20:58. | |
evolving threat. My right honourable friend is | :20:59. | :21:05. | |
absolutely right when he says security must be the Government's | :21:06. | :21:07. | |
top priority, something I am sure people will feel comfortable within | :21:08. | :21:09. | |
the long run. My honourable friend mentioned minimising disruption and | :21:10. | :21:11. | |
frustration for passengers. I want if he could tell us what discussions | :21:12. | :21:15. | |
he's had with the Home Office counterparts that border force to | :21:16. | :21:20. | |
minimise disruptions when on Monday this week Gatwick only had five | :21:21. | :21:22. | |
scanners working from the very many they had. | :21:23. | :21:28. | |
Obviously that is disappointing if there is a temporary problem at the | :21:29. | :21:31. | |
Apple. Gatwick, my experience of travelling through there in recent | :21:32. | :21:36. | |
times, is its pretty good. I think probably something must have gone | :21:37. | :21:38. | |
wrong on that particular day. What I would say to him is I know all of | :21:39. | :21:44. | |
our airports and those in the board border agency will work with the | :21:45. | :21:47. | |
airlines to try make sure that any steps we take to address security | :21:48. | :21:51. | |
issues are done so in a way that minimises the maximum possible | :21:52. | :21:59. | |
extent. The Secretary of State is absolutely | :22:00. | :22:02. | |
right to take whatever measures are necessary to protect the public from | :22:03. | :22:05. | |
the threat of terrorism. But further to the question put by the member in | :22:06. | :22:12. | |
respect of Egypt, he mentioned to Messier, which has already been | :22:13. | :22:15. | |
suffering because of the travel ban. This will be an added burden on | :22:16. | :22:20. | |
those travelling from Tunisia is the Tunisian authorities came to the | :22:21. | :22:23. | |
Government and asked for assistance with the initiation of new scanner | :22:24. | :22:28. | |
equipment would we be willing to help them provide that kind of | :22:29. | :22:34. | |
equipment? Well, Mr Speaker, I'm grateful to | :22:35. | :22:38. | |
the right honourable gentleman for his supportive comments. We already | :22:39. | :22:42. | |
provide extensive support and will continue to do so. My honourable | :22:43. | :22:45. | |
friend the Minister is due to be visiting there in a couple of weeks' | :22:46. | :22:50. | |
time. We are already in contact with the Tunisians and with the Egyptians | :22:51. | :22:54. | |
and we will do what we can to help them, both with this issue and | :22:55. | :22:59. | |
related issues, but will always put the safety of our own citizens | :23:00. | :23:03. | |
first. Further to the point made raised by | :23:04. | :23:09. | |
the member for Devon East there are about 100,000 people employed in the | :23:10. | :23:13. | |
tourist industry and Shah Mel Sheikh. This could lose their jobs | :23:14. | :23:18. | |
if the flight ban continues. Does my right honourable friend consult with | :23:19. | :23:23. | |
other people I see sitting on the Treasury bench to ensure the impact | :23:24. | :23:27. | |
of that degree of unemployment and the impact that could have on the | :23:28. | :23:31. | |
wider supply chain jobs that could lead to further radicalisation of | :23:32. | :23:34. | |
people in the south Sinai are considered? | :23:35. | :23:39. | |
What I would say to my honourable friend is we have extensive | :23:40. | :23:44. | |
conversations with the Egyptians. We have the situation in Sharm El | :23:45. | :23:49. | |
Sheikh under permanent monitoring by my right honourable friends in the | :23:50. | :23:54. | |
Commonwealth office and Home Office, who are in regular contact about | :23:55. | :23:58. | |
these issues, as is my own department. Fundamentally, whilst I | :23:59. | :24:01. | |
would love to see us resume flights to Sharm El Sheikh at the earliest | :24:02. | :24:05. | |
opportunity, we can only do so at a point where we are confident about | :24:06. | :24:09. | |
the security and safety of our own people. I'm sure once they have that | :24:10. | :24:12. | |
confidence we would want to resume those flights. | :24:13. | :24:17. | |
The Government is of course right to act swiftly in response to | :24:18. | :24:21. | |
intelligence regarding terror threats but a number of very | :24:22. | :24:26. | |
important questions remain. I think as another member noted, some | :24:27. | :24:33. | |
passengers will change planes in third countries. What discussions as | :24:34. | :24:36. | |
he had with his counterparts in other countries about the | :24:37. | :24:39. | |
implementations of these restrictions for transfer | :24:40. | :24:42. | |
passengers? Well, Mr Speaker, I said yesterday | :24:43. | :24:48. | |
as we took the decision, we have already had contact at ambassadorial | :24:49. | :24:52. | |
and add some places at ministerial level with our counterparts in other | :24:53. | :24:56. | |
countries. They will each take their own dishes decisions about what is | :24:57. | :24:59. | |
necessary, but we are clear what is right for our citizens. -- their own | :25:00. | :25:04. | |
decisions. Other countries will be contemplating what their best steps | :25:05. | :25:10. | |
are in terms of their rent citizens. As this is an evolving threat can my | :25:11. | :25:15. | |
right honourable friend confirmed that countries and indeed airports | :25:16. | :25:19. | |
could be added, and indeed removed from the list the Government has | :25:20. | :25:23. | |
public should, should the British intelligence services so recommend? | :25:24. | :25:29. | |
We will obviously keep this and other security issues in relation to | :25:30. | :25:32. | |
our aviation sector under review. We will take whatever steps in future | :25:33. | :25:36. | |
are necessary to provide that protection. It is my hope that this | :25:37. | :25:41. | |
new set of measures will ultimately prove to be temporary, but first and | :25:42. | :25:44. | |
foremost our focus will be on the security and safety of our | :25:45. | :25:50. | |
passengers, and so that will be a deciding factor on what we do in the | :25:51. | :25:53. | |
future. The US ban will be enforced on | :25:54. | :26:01. | |
Saturday, following 96 hours notice. He said earlier airlines here | :26:02. | :26:04. | |
implemented over a short period of time. Has he given the airlines in | :26:05. | :26:10. | |
the UK an indication of a firm deadline by which he expects | :26:11. | :26:14. | |
implementation of the UK ban? We are expecting this to be | :26:15. | :26:19. | |
commended in the same time frame. I am sure the Secretary of State | :26:20. | :26:22. | |
would agree on a day like this it should be about reassurance. That | :26:23. | :26:27. | |
threats are reacted too, that passengers shouldn't be panicking | :26:28. | :26:33. | |
about these announcements. What steps will be taken to reassure | :26:34. | :26:36. | |
passengers as well as inform them of government is doing? | :26:37. | :26:41. | |
Let me be clear to the House again. We are not saying to people not to | :26:42. | :26:45. | |
travel to these countries. We are not saying to people cancel your | :26:46. | :26:49. | |
flights or cancel your holidays. We want aviation to continue as normal. | :26:50. | :26:54. | |
We are simply taking additional security measures to make sure that | :26:55. | :26:57. | |
that aviation is safe for those people who travel and there is | :26:58. | :27:01. | |
absolutely no change to Foreign Office travel advice, no changed of | :27:02. | :27:06. | |
advice to people about how and when they should travel. This is purely | :27:07. | :27:08. | |
about making sure when they travelled they are safe. | :27:09. | :27:15. | |
The Secretary of State has said that anyone who is travelling with a hand | :27:16. | :27:20. | |
baggage only dig it would not be charged or out-of-pocket and | :27:21. | :27:24. | |
encouraging the airlines to take the right course of action. With the | :27:25. | :27:28. | |
Secretary of State considered doing something further to make sure that | :27:29. | :27:31. | |
no one is going to be charged for putting hand baggage in the hold? | :27:32. | :27:35. | |
Mr Speaker, this is something we are in discussion with the airlines | :27:36. | :27:39. | |
about. This is not about inability to take hand luggage into the cabin. | :27:40. | :27:43. | |
If somebody arrives at the gate with one of these items in their bag it | :27:44. | :27:47. | |
will be put in the hold. It's not about saying you can't have hand | :27:48. | :27:51. | |
luggage. So some people may choose to put their handbag into the hold | :27:52. | :27:54. | |
it is simply about the device itself. | :27:55. | :28:03. | |
Thank you to the Secretary of State. I am not seeking any information | :28:04. | :28:07. | |
from him on the nature of the, but I am compare concerned diplomatic | :28:08. | :28:13. | |
diplomatic relationships with allies. I have returned Egypt and | :28:14. | :28:19. | |
its security arrangements are that jeopardises the longer term security | :28:20. | :28:23. | |
of UK citizens. That is precisely why these are | :28:24. | :28:27. | |
difficult issues and why we will do everything we can to strengthen our | :28:28. | :28:31. | |
partnerships with those nations and to send a very clear message that | :28:32. | :28:35. | |
not saying to people as a result of this change stop flying on those | :28:36. | :28:40. | |
routes. This is about saying, actually, you should have more | :28:41. | :28:43. | |
confidence in flying on those routes because I believe the measures we | :28:44. | :28:46. | |
are putting in place today should protect your safety, rather than | :28:47. | :28:54. | |
have the opposite effect. I commend my honourable friend from | :28:55. | :29:00. | |
Luton for raising this up important question. We are approaching Easter, | :29:01. | :29:03. | |
a time when many families will be taking flights, many of those | :29:04. | :29:07. | |
families will be nervous flyers or have nervous fliers among those | :29:08. | :29:11. | |
families. What reassurance can be given to those families, taking | :29:12. | :29:14. | |
flight from other destinations, not once listed, that the terrorists are | :29:15. | :29:17. | |
not just going to go we can no longer fly and use our laptops in an | :29:18. | :29:21. | |
appallingly offended way on these flights, we will go to another | :29:22. | :29:25. | |
country that doesn't have a ban. What reassurances can those | :29:26. | :29:27. | |
countries have? The reassurance I would give to | :29:28. | :29:29. | |
Point of order. Previously on a business question I pointed out the | :29:30. | :33:47. | |
Lib Dems and Labour have been fined for conduct in the 2015 election and | :33:48. | :33:53. | |
I drew attention to the fact the Tories were under investigation and | :33:54. | :33:56. | |
the Electoral Commission expressed concerns finds were not a deterrent. | :33:57. | :34:03. | |
The leader of the house dismissed me with a how dare I raised that? Now | :34:04. | :34:17. | |
that the Tories have been fined a record ?70,000, how can I make sure | :34:18. | :34:22. | |
the record is correct that the SNP is the only major party not find at | :34:23. | :34:27. | |
the election and there were no financial shenanigans. Thank you for | :34:28. | :34:34. | |
the point of order and characteristic courtesy in giving me | :34:35. | :34:38. | |
advance notice of his intention to raise it. I would say first of all | :34:39. | :34:45. | |
he has found his own salvation by putting what he regards as the | :34:46. | :34:50. | |
factors of the mass of the record. Where they will permanently reside. | :34:51. | :34:57. | |
Doubtless to the great delight of the honourable gentleman and | :34:58. | :35:00. | |
possibly of other people in Caol Marnoch. Secondly, -- Kilmarnock. | :35:01. | :35:07. | |
When the honourable gentleman says what can be done to secure an | :35:08. | :35:11. | |
apology from the leader of the house, I fear that that may be a | :35:12. | :35:21. | |
case of optimism triumphing over reality. I was here at the time. The | :35:22. | :35:28. | |
leader of the house is responsible for what he says. I think the leader | :35:29. | :35:34. | |
of the house offered a robust response in the course of what might | :35:35. | :35:37. | |
be thought to be a knock-about exchange. I have always thought the | :35:38. | :35:43. | |
honourable member for kill Marnoch is a steely fellow himself, but if I | :35:44. | :35:49. | |
am mistaken on that front, can I commend him the benefits of | :35:50. | :35:53. | |
acquiring at least one of the characteristics of the rhinoceros. I | :35:54. | :36:00. | |
am referring not, of course, to aesthetic beauty, but two notable | :36:01. | :36:05. | |
resilience. We will leave it there for now. If there are no further | :36:06. | :36:11. | |
points of order, at any rate not for the moment, we come now to the | :36:12. | :36:24. | |
presentation of a Bill. Order. I'm sure honourable members will await | :36:25. | :36:28. | |
with anticipation and a degree of excitement the presentation of bill | :36:29. | :36:34. | |
in the name of the right honourable gentleman for Leicester East, Vista | :36:35. | :36:40. | |
Keith Vaz violent crime sentences Bill. -- Mr Keith vows. Order, we | :36:41. | :36:53. | |
come now to the Ten Minute Rule Motion. Mr Tim Farron. I beg to move | :36:54. | :36:59. | |
leave be given for me to bring in a Bill to make provision for the | :37:00. | :37:03. | |
holding of a referendum in the UK and Gibraltar on the proposed terms | :37:04. | :37:09. | |
for the United Kingdom to leave the European Union and connected | :37:10. | :37:13. | |
purposes. In June last year a narrow majority voted for the UK to leave | :37:14. | :37:17. | |
the European Union. I regret the outcome but I am a Democrat and | :37:18. | :37:22. | |
accept it. A week from today divorce proceedings will begin and the | :37:23. | :37:27. | |
country faces a greater period of uncertainty than most of us have | :37:28. | :37:31. | |
experience. One thing is certain, democracy did not end at 10pm on the | :37:32. | :37:38. | |
23rd of June last year. The Secretary of State for Exiting the | :37:39. | :37:42. | |
European Union aid the case eloquently for what is now this | :37:43. | :37:45. | |
proposal from the Liberal Democrats and others and used the phrase a | :37:46. | :37:51. | |
first mandate referendum and then a second decision referendum and said | :37:52. | :37:55. | |
and I quit, the aim of the strategy is to give the British people the | :37:56. | :38:00. | |
final say, but is also to reinforce the legitimacy and negotiating power | :38:01. | :38:05. | |
of the British negotiating team, end of quote. I could not agree with him | :38:06. | :38:11. | |
more. It is a great shame he does not agree with himself any more. In | :38:12. | :38:16. | |
rejecting a second referendum on independence to Scotland last week, | :38:17. | :38:21. | |
the Prime Minister said, I quote, I think it will be fair, I am sorry, | :38:22. | :38:26. | |
would not be fair to the people of Scotland because they are being | :38:27. | :38:29. | |
asked to make a crucial decision without all the necessary | :38:30. | :38:32. | |
information, without knowing what the future partnership would be or | :38:33. | :38:36. | |
what the alternative of an independent Scotland would look | :38:37. | :38:41. | |
like, end of quote. She is now asking the United Kingdom to proceed | :38:42. | :38:45. | |
to forge a relationship with the rest of Europe and the world on | :38:46. | :38:50. | |
exactly that basis, a decision taken last June and without as she says, | :38:51. | :38:55. | |
all the necessary information. Without knowing what the future | :38:56. | :39:02. | |
partnership would be. The Secretary of State for exiting the EU original | :39:03. | :39:06. | |
case stands. We started the process last June with democracy, so we must | :39:07. | :39:11. | |
end it with democracy. I accept we have had our mandate referendum in | :39:12. | :39:15. | |
which the British people voted to leave but voting for departure is | :39:16. | :39:19. | |
not the same as voting for a destination and the government | :39:20. | :39:22. | |
should give the British people a decision referendum to be held when | :39:23. | :39:27. | |
the negotiation is concluded say that the people have all information | :39:28. | :39:33. | |
and know what our future partnership will be, because it is the people | :39:34. | :39:36. | |
who are suffering. The people must have their say over what comes next | :39:37. | :39:42. | |
and this Bill would enshrine in law their right to do so. Last week when | :39:43. | :39:47. | |
debating even the right of Parliament to have the final say on | :39:48. | :39:52. | |
the Brexit deal, the government displayed ludicrous inconsistency | :39:53. | :39:56. | |
and double standards. They asked us to take back control but the first | :39:57. | :40:00. | |
thing they do is undermine the principle of democratic | :40:01. | :40:05. | |
accountability. By refusing to allow a meaningful vote in this House. The | :40:06. | :40:10. | |
detail or general nature of the deal this government may reach with the | :40:11. | :40:15. | |
EU is currently completely unknown and a mystery to us and to them, yet | :40:16. | :40:21. | |
the British people are now told they must simply shrug and accept any old | :40:22. | :40:27. | |
deal, irrespective of its content or quality. When a deal is done it will | :40:28. | :40:32. | |
be signed off by someone. The only question is who? Will it be the | :40:33. | :40:37. | |
politicians, will it be the people? My party believes the deal should be | :40:38. | :40:44. | |
signed off by the people. There were no plans, instructions, prospectus, | :40:45. | :40:49. | |
vision offered to voters by the campaign. I did not agree with the | :40:50. | :40:55. | |
case for Scottish independence in 2014 but credit where credit is due. | :40:56. | :41:03. | |
There was a 670 page prospectus of what Scotland outside the United | :41:04. | :41:06. | |
Kingdom would look like will stop believers did not present the | :41:07. | :41:09. | |
British people with a prospectus. All they gave us was a lie on the | :41:10. | :41:15. | |
side of a bus. The pro-independence campaign in Scotland presented the | :41:16. | :41:19. | |
Scottish people not just with the option of departure but also with | :41:20. | :41:26. | |
the option of destination. The Scottish people voted against | :41:27. | :41:29. | |
departure and destination, but if the result had gone the other way | :41:30. | :41:33. | |
there would have been no need to hold a people'svote on the final | :41:34. | :41:38. | |
deal of independence from the UK. I still believe it is impossible for | :41:39. | :41:43. | |
this government to negotiate a better deal with Europe than the one | :41:44. | :41:46. | |
they currently, we currently have is a member of the European Union, but | :41:47. | :41:53. | |
these negotiations will happen and a deal will be reached. Surely it is | :41:54. | :41:58. | |
the only right and logical step to take to allow the people to decide | :41:59. | :42:02. | |
whether it is the right deal for them, their families, jobs, their | :42:03. | :42:08. | |
country. No one knows what the final deal will look like, but what we do | :42:09. | :42:12. | |
know is the Prime Minister has already given up on the United | :42:13. | :42:16. | |
Kingdom's membership of the single market without even putting up a | :42:17. | :42:22. | |
fight. In January, after months of saying Brexit means Brexit, she | :42:23. | :42:27. | |
finally came clean. Brexit means jumping out of the single market, | :42:28. | :42:31. | |
the biggest marketplace, with all the consequences that will have for | :42:32. | :42:36. | |
jobs and our economy. The Prime Minister is entitled to make that | :42:37. | :42:43. | |
choice, but let us be clear, it is a choice, one of the reasons why I was | :42:44. | :42:48. | |
astounded that the right honourable gentleman for is lit in North and | :42:49. | :42:52. | |
many in his party, but not all, made the decision to vote with the | :42:53. | :42:56. | |
government on Article 50 because this House did not vote to enact the | :42:57. | :43:02. | |
will of the people, this House voted to interpret the will of the people | :43:03. | :43:07. | |
and just like the Conservative Party in 2015 in their manifesto, I | :43:08. | :43:12. | |
passionately believe ending our membership of the world's biggest | :43:13. | :43:17. | |
free market will do damage to this country, it is vital for our economy | :43:18. | :43:22. | |
and that is my my party and others refused to stop making the case that | :43:23. | :43:26. | |
this deal must include membership of the single market. The Prime | :43:27. | :43:31. | |
Minister had the choice to pursue a former Brexit that united our | :43:32. | :43:34. | |
country and reflected the closeness of the vote and sought to heal | :43:35. | :43:39. | |
divisions between leave and remain. She could have fought to keep us in | :43:40. | :43:44. | |
the single market if she wanted to. She has chosen not to, she is | :43:45. | :43:48. | |
pulling is out before negotiations have begun will stop yes, narrowly, | :43:49. | :43:55. | |
the British people chose Brexit, but nobody voted for severance, | :43:56. | :44:00. | |
irrelevance and decline that this exit from the single market will | :44:01. | :44:04. | |
bring. It is this Conservative government that has chosen this | :44:05. | :44:10. | |
Brexit. The referendum vote does not give the government a mandate for | :44:11. | :44:15. | |
absolute severance from Europe. For 40 years the anti-European crowd | :44:16. | :44:20. | |
have been saying words to the effect of in 1975I voted to be in the | :44:21. | :44:25. | |
common market, I didn't vote to be in the European Union. Now we turn | :44:26. | :44:30. | |
that on its head because in June, people narrowly voted to leave the | :44:31. | :44:34. | |
European Union, but nobody voted to leave the common market. They were | :44:35. | :44:39. | |
simply not asked. Nor did they vote to place a question mark over the | :44:40. | :44:45. | |
status of friends and neighbours and loved ones to happen to be born in | :44:46. | :44:50. | |
another part of the European Union. The action of this government and | :44:51. | :44:54. | |
unwillingness to guarantee the rights of EU citizens living here is | :44:55. | :44:58. | |
shameful and contrary to British values of openness and tolerance to | :44:59. | :45:03. | |
refuse to do so. What I am seeking to do is to reinforce and strengthen | :45:04. | :45:09. | |
the will of the people to allow the people to exercise their democratic | :45:10. | :45:12. | |
rights and duties by giving them a choice over what we and our children | :45:13. | :45:18. | |
will have to live with for generations, to either accept the | :45:19. | :45:22. | |
deal the government cheese, or to say thanks, but no thanks, and opt | :45:23. | :45:28. | |
to remain in the European Union. The gate has been opened, the direction | :45:29. | :45:33. | |
is set, but the only way to achieve democracy and closure for both leave | :45:34. | :45:37. | |
and remain voters is for there to be a vote at the end and if the Prime | :45:38. | :45:42. | |
Minister is so confident what she is planning to do is what the people | :45:43. | :45:47. | |
voted for, then why not give them a vote on the final deal? What is she | :45:48. | :45:54. | |
scared of? What started with democracy cannot end with a stitch | :45:55. | :45:58. | |
up. The deal must not be merely rubber-stamped, it must be agreed by | :45:59. | :46:04. | |
the people. The question is that the honourable member have leave to | :46:05. | :46:10. | |
bring in the Bill. As many who say aye. On the contrary, no. I think | :46:11. | :46:20. | |
the ayes have it. He will bring in the Bill. Tom Brake, Norman Lamb, | :46:21. | :46:29. | |
Greg Mulholland, Mr Mark Williams, Heidi Alexander, Geron Davis, | :46:30. | :46:33. | |
Caroline Lucas, Jonathan Edwards and myself. | :46:34. | :46:41. | |
The terms of withdrawal from the European Union referendum bill. | :46:42. | :47:08. | |
Second reading, what day? 12th of May, 2017, sir. 12th of May, 2017. | :47:09. | :47:18. | |
Thank you. Order, we come now to the programme motion. The ministers | :47:19. | :47:20. | |
move. Move formerly. Thank you. The | :47:21. | :47:32. | |
question is as on the order paper. As many of those who say aye, on the | :47:33. | :47:39. | |
country no? I think the ayes habit. The clerk will proceed to be the | :47:40. | :47:43. | |
orders of the day. Pension Schemes Bill laws as amended to be | :47:44. | :47:50. | |
considered. We begin with new clause one, with which it will be | :47:51. | :47:54. | |
convenient to consider the new clauses and amendments listed on the | :47:55. | :47:58. | |
selection paper. To move new clause one, I call Mr Alex culling -- | :47:59. | :48:05. | |
Cunningham. We believe this is a good bill and goes a long way to | :48:06. | :48:10. | |
regulating trusts and looking after interests of members. Sadly it does | :48:11. | :48:18. | |
not address the issue that has been ruled out of scope of the Bill but I | :48:19. | :48:23. | |
am pleased to report Stockton Borough Council backed it but Tory | :48:24. | :48:27. | |
councillors abstained on that vote and so clearly they are not happy | :48:28. | :48:32. | |
with the government, either. That said, we feel there are areas in the | :48:33. | :48:36. | |
Bill that could still be improved and scheme members even better | :48:37. | :48:38. | |
protected and informed. After the Commons committee stage we | :48:39. | :48:45. | |
failed to convince the Government that having reviewed the Minister 's | :48:46. | :48:48. | |
argument we still believed there were a number of issues we needed to | :48:49. | :48:51. | |
cover at report stage this afternoon. The first of those I am | :48:52. | :48:55. | |
forced to bring forward is the new clause one, the return to the issue | :48:56. | :49:02. | |
of a last resort to master trust. The written statement read received | :49:03. | :49:05. | |
on Monday, I think the removal of this clause is significant. I was | :49:06. | :49:12. | |
surprised that he felt it was not. Mr Speaker, Mr Deputy Speaker, this | :49:13. | :49:16. | |
new clause looks to ensure that in the event of a master trust | :49:17. | :49:22. | |
failing... Sorry, excuse me, I've lost my place. This new clause looks | :49:23. | :49:26. | |
to ensure in the event of a master trust failing there is a thunder of | :49:27. | :49:30. | |
last resort, some money in place guaranteed the scheme members are | :49:31. | :49:34. | |
not left out of pocket through no fault of their own. This would in | :49:35. | :49:38. | |
effect act as a final underpinning of the promises that have been made | :49:39. | :49:42. | |
to scheme members. Giving them recourse to legally establish a | :49:43. | :49:47. | |
funding organisation committed to making good on scheme members to | :49:48. | :49:54. | |
use. When debated the ministers failed to add this to the Bill, | :49:55. | :50:04. | |
placing an unnecessary burden... The risk of collapse is minimal, the | :50:05. | :50:09. | |
existing master trust would pick up any persons affected the Government | :50:10. | :50:17. | |
consulting the industry on a panel of White knights who would commit to | :50:18. | :50:21. | |
stepping in to ensure all scheme members are protected. I'm glad we | :50:22. | :50:24. | |
have the Minister on record, saying there is no chance of their master | :50:25. | :50:30. | |
trust going bust under the regulatory regime this Bill creates. | :50:31. | :50:33. | |
It's clearly a gamble he is willing to take. On this side of the chamber | :50:34. | :50:38. | |
we are not prepared to gamble with peoples pension savings. We believe | :50:39. | :50:42. | |
that in order to best protect scheme members we need strongest possible | :50:43. | :50:47. | |
regulatory environment in place, unlike the minister we are not | :50:48. | :50:51. | |
content to leave things to chance. We have support from the industry | :50:52. | :50:56. | |
itself on these proposals. For example the chair of standard life | :50:57. | :51:00. | |
has called on the Government to be the founder of last resort because | :51:01. | :51:08. | |
it is, they say, their foulups have led to these failures of master | :51:09. | :51:11. | |
trust. The Minister plans for a panel of | :51:12. | :51:14. | |
white knights. Does that suggest he does accept that there is a chance | :51:15. | :51:19. | |
that a master trust might slip through his regulatory regime and | :51:20. | :51:23. | |
leave scheme members unprotected? If he does, why not go the whole way | :51:24. | :51:29. | |
and put the proper guarantees on the face of the legislation? There is | :51:30. | :51:32. | |
simply no guaranteed that another trust will choose to pick up one | :51:33. | :51:37. | |
that is failing. Why would they? What obligation do they have, and | :51:38. | :51:41. | |
why would it be in their interests to do so? There have been a few | :51:42. | :51:46. | |
pragmatic actions in this area but nothing, nothing is guaranteed. | :51:47. | :51:51. | |
We all know the pensions industry and financial services industry have | :51:52. | :51:54. | |
seen plenty of failures. At the Minister can tell us what happens if | :51:55. | :52:00. | |
a large master trust fails and the data is in MS takes months to | :52:01. | :52:07. | |
transfer members to a new skin? We cannot hope another trust will | :52:08. | :52:11. | |
simply pick that up but instead we must intervene now to ensure a | :52:12. | :52:14. | |
proper back-up plan. The Government must prepare for the worse case | :52:15. | :52:18. | |
scenario and nothing I've seen so far convinces me that ministers are | :52:19. | :52:23. | |
doing so. This is why there needs to be a | :52:24. | :52:27. | |
thunder of last resort, because we must predict what could possibly | :52:28. | :52:30. | |
happen, even if there is only the slightest chance, and ensure we have | :52:31. | :52:36. | |
protection in place. I ask again, why won't the Minister provide | :52:37. | :52:40. | |
people all over this country with a 100% assurance that the Bill without | :52:41. | :52:44. | |
this provisional is enough to protect members? He must guarantee | :52:45. | :52:48. | |
that no master trust will be in a situation whereby it has failed and | :52:49. | :52:54. | |
has insufficient resources to meet costs, if he is to ignore our | :52:55. | :52:58. | |
sensible amendment. In the absence of greater clarity, it is essential | :52:59. | :53:02. | |
that this new clause remains in the Bill. | :53:03. | :53:08. | |
I now turn to new clause two on the issue of member nominated trustees | :53:09. | :53:13. | |
the master trusts. I would remind the House all the investment risk | :53:14. | :53:16. | |
lies with the member and not the sponsor or the provider of the | :53:17. | :53:19. | |
scheme and they should therefore have representation at the | :53:20. | :53:22. | |
decision-making levels of the scheme. The pensions act 1995 | :53:23. | :53:28. | |
introduce the requirement for company pension schemes to have | :53:29. | :53:34. | |
member nominated trustees. If the scheme's sole trustee of the | :53:35. | :53:38. | |
company, including the employer rather than individuals, scheme | :53:39. | :53:41. | |
members will have the right to nominate directors of that company, | :53:42. | :53:48. | |
member nominated directors. The 2004 pensions act enshrined the act that | :53:49. | :53:55. | |
at least one third of scheme trustees. The pensions regulator is | :53:56. | :53:59. | |
clear that master trusts are covered by this legislation, which is why | :54:00. | :54:04. | |
some already have member nominated trustees. What the TPR offers in | :54:05. | :54:09. | |
explanation is that that exemption that can be taken by master trusts, | :54:10. | :54:13. | |
given the reason having Paul of members poses problems of choice. We | :54:14. | :54:19. | |
find that an inadequate reason for exemption. The greater the number of | :54:20. | :54:26. | |
members, then surely the bigger the of choice. We agree independent | :54:27. | :54:31. | |
trustees can adequately represent the interests of members if they | :54:32. | :54:34. | |
have no stake in the investment process. What's more, they are paid | :54:35. | :54:39. | |
and chosen by the master trust. This exemption seems like a convenient | :54:40. | :54:43. | |
way of denying the right to representation of those who have a | :54:44. | :54:46. | |
material interest in the performance of the master trusts. So we are | :54:47. | :54:50. | |
returning with an amendment that seeks to give members the law they | :54:51. | :54:56. | |
should be entitled to. My references apply equally to M MDs. The | :54:57. | :55:03. | |
Association of member nominated trustees is adamant that master | :55:04. | :55:07. | |
trusts must be obliged to have member representation on their | :55:08. | :55:12. | |
boards. It is no surprise that a master trust are lobbying against | :55:13. | :55:15. | |
this, but these companies are mostly profit-making entities. I'd say it | :55:16. | :55:20. | |
is that their own best interests that they have scheme member | :55:21. | :55:25. | |
representation in order to win the confidence of the scheme members. | :55:26. | :55:30. | |
The role of the trustee boards is sometimes underplayed or | :55:31. | :55:34. | |
undervalued. The association said, "Members are particularly comforted | :55:35. | :55:38. | |
by having a member nominated trustee for their scheme. It helps them to | :55:39. | :55:43. | |
feel reassured their retirement interests are truly being met and | :55:44. | :55:47. | |
also they are being ripped off with excessive costs and charges." They | :55:48. | :55:51. | |
are the only ones who have no personal interest or gain other than | :55:52. | :55:54. | |
that of the members interests. Shared action also agree the saver | :55:55. | :55:59. | |
should be able to subject decisions made on their behalf to healthy | :56:00. | :56:06. | |
degree of scrutiny and challenge. Ensuring effective governance of | :56:07. | :56:15. | |
pension schemes remains a challenge, whilst there is a clear absence of | :56:16. | :56:19. | |
member nominated trustees in the majority of master trusts. However, | :56:20. | :56:25. | |
while some companies choose to operate to contribution scheme, most | :56:26. | :56:29. | |
auto enrolled members will not find themselves paying into one. Instead | :56:30. | :56:33. | |
the vast majority of people will find themselves saving into a master | :56:34. | :56:36. | |
trust or a group personal pension arrangement. In these schemes member | :56:37. | :56:42. | |
representation is on-board more rare and at this point I would like to | :56:43. | :56:45. | |
refer back to the concerns TPR made about master trust governance. | :56:46. | :56:50. | |
In January 20 13th the pensions regulator said, "We have identified | :56:51. | :56:56. | |
a number of characteristics that if present may prevent master trust | :56:57. | :57:00. | |
schemes from delivering good outcomes. These are, | :57:01. | :57:04. | |
conflict-of-interest as a result of the relationship between the | :57:05. | :57:06. | |
provider and trustees. Decision-making powers resting with | :57:07. | :57:12. | |
the provider rather than trustees. A lack of independent oversight in | :57:13. | :57:16. | |
some master trusts. Unlike traditional schemes, they are | :57:17. | :57:25. | |
unlikely to be involved in the decision-making processes." The Bill | :57:26. | :57:28. | |
may go some way to addressing these concerns but doesn't go far enough. | :57:29. | :57:33. | |
If we can build greater trust in the system, increased diversity and | :57:34. | :57:38. | |
bring a range of different perspectives and experiences and | :57:39. | :57:41. | |
highlight areas that are of interest to members. Once again we find no | :57:42. | :57:46. | |
real impediment to this amendment. The law require master trusts to | :57:47. | :57:50. | |
have master trustees applies. Exemption exists but it is not | :57:51. | :57:54. | |
required and in our view should be overridden. | :57:55. | :57:56. | |
Continuing with the theme of engaging with new members, clause | :57:57. | :58:04. | |
three. New clause three requires that one year on from the | :58:05. | :58:07. | |
incorporation and registration of master trust by the pensions | :58:08. | :58:11. | |
regulator the Government will fully review member trustee and | :58:12. | :58:14. | |
representation, member engagement and annual General meetings for | :58:15. | :58:18. | |
members. The purpose of this amendment is to ensure there is a | :58:19. | :58:22. | |
review of the new master trust governance and member engagement | :58:23. | :58:26. | |
processes. The pensions regulator guidance stressed the importance of | :58:27. | :58:30. | |
understanding and engaging with members, in order to define | :58:31. | :58:33. | |
objectives to this scheme and setting an appropriate strategy. For | :58:34. | :58:40. | |
example, the TPR quote both practice of occupational trust they schemes. | :58:41. | :58:47. | |
TPR has stacks of advice on these issues the master trusts to follow | :58:48. | :58:50. | |
but we want a commitment from the Government that they will ensure | :58:51. | :58:54. | |
that master trusts are operating in the interests of and the potential | :58:55. | :58:56. | |
of a printout conflict-of-interest, of a printout conflict-of-interest, | :58:57. | :59:01. | |
the profit motive, doesn't get in the way. We need to make sure there | :59:02. | :59:05. | |
was an opportunity for experienced eyes to take a good look at the | :59:06. | :59:10. | |
system a year after its creation. If there are risks, they must be | :59:11. | :59:14. | |
accounted for and one way to do this is to perform a government | :59:15. | :59:19. | |
inspection of the system. Now I attended new clause four which | :59:20. | :59:22. | |
requires master trusts to hold an annual member meeting and sets out | :59:23. | :59:26. | |
ways to ensure members are properly given the opportunity to be | :59:27. | :59:30. | |
involved. It is now common practice for | :59:31. | :59:33. | |
pension funds to hold a meeting with members on an annual basis. Good | :59:34. | :59:38. | |
member communications provided at the right time and in an accessible | :59:39. | :59:43. | |
format are vital if members are to engage and make decisions that lead | :59:44. | :59:48. | |
to good outcomes in retirement. In the committee debate the minister | :59:49. | :59:52. | |
suggested that "Documents relating to the governments of the scheme, | :59:53. | :59:55. | |
such as the trustees annual reports, the chap's statement and statement | :59:56. | :00:01. | |
of investment principles have to be provided on request." Having to | :00:02. | :00:04. | |
request information for what you're paying for is the wrong way around. | :00:05. | :00:09. | |
Let's not forget that many master trusts are profit-making, so members | :00:10. | :00:13. | |
should be given information as a matter of routine and not of | :00:14. | :00:15. | |
request. An annual meeting for members | :00:16. | :00:20. | |
ensures that trustees and administrators can be made human and | :00:21. | :00:23. | |
accountable, rather than some distant, bureaucratic, faceless | :00:24. | :00:31. | |
place. When deciding on the format of communications they should take | :00:32. | :00:34. | |
account of innovations in technology that may be available to them and | :00:35. | :00:38. | |
appropriate to their members. This would allow the more engage members | :00:39. | :00:43. | |
to hear a presentation from trustees and senior executives about how the | :00:44. | :00:46. | |
scheme has managed the retirement assets over the previous year and | :00:47. | :00:51. | |
what plans the scheme had to deliver strategy and manage risk into the | :00:52. | :00:52. | |
future on behalf of members. The pension regulators guidance | :00:53. | :01:02. | |
accompanying its new DC code highlights one way that | :01:03. | :01:07. | |
multi-employer schemes can stay close to members. Through the clause | :01:08. | :01:11. | |
master trusts would be brought into line with normal practice in the | :01:12. | :01:13. | |
corporate sector and among the growing at number of pension | :01:14. | :01:20. | |
schemes. I want to return to new clause five, to the issue of groups | :01:21. | :01:26. | |
currently excluded from master trust savings, carers, the self-employed, | :01:27. | :01:30. | |
those working multiple jobs and people on low incomes. As it stands | :01:31. | :01:35. | |
the Bill does not expand the successful auto in Roman policy and | :01:36. | :01:38. | |
it could have made a real difference to a number of groups who evidence | :01:39. | :01:42. | |
suggests are not saving adequately for their retirement. The minister | :01:43. | :01:48. | |
and I debated this in committee so I shall turn to this issue only | :01:49. | :01:52. | |
briefly. As I recognise them, the Government has announced a review | :01:53. | :01:57. | |
relating to the operation of auto enrolment. Currently the scope of | :01:58. | :02:03. | |
that review is too broad. The evidence speaks for itself. Too many | :02:04. | :02:06. | |
people are not putting enough away to guarantee the secure and | :02:07. | :02:10. | |
dignified retirement that the Labour Party has always worked to provide | :02:11. | :02:15. | |
and continues to strive towards today. 37% of female workers, 37% of | :02:16. | :02:25. | |
workers with a disability and 28% of black and ethnic minority workers | :02:26. | :02:31. | |
are not eligible for master trust enrolment. In committee the minister | :02:32. | :02:35. | |
suggested gender equality was not an issue under auto enrolment savings. | :02:36. | :02:41. | |
I suspect they were referring to the participation rate which is fairly | :02:42. | :02:46. | |
equal between genders. The statistics have quoted however Rick | :02:47. | :02:50. | |
Waite relate to those who are not eligible. Perhaps the Minister can | :02:51. | :02:54. | |
look again at this issue and right if he has evidence to the country. | :02:55. | :02:58. | |
On the specific groups I would like to press the minister on the issue | :02:59. | :03:03. | |
of carers, who as he knows make such a vital contribution to our society, | :03:04. | :03:05. | |
public services and economy. The minister suggested he would like | :03:06. | :03:14. | |
Cerys to be included under the review of auto enrolment but | :03:15. | :03:17. | |
accepted they are not currently specified. -- carers. Can I push him | :03:18. | :03:27. | |
to include carers under the review now and it would be a comfort to | :03:28. | :03:31. | |
them if they knew the situation was being looked at by the government. | :03:32. | :03:35. | |
Turning to the self-employed, I know the government have had a lot to say | :03:36. | :03:39. | |
about the self-employed, though I note they have gone quiet on the | :03:40. | :03:51. | |
issue in the past week. With those with multiple jobs it is good they | :03:52. | :03:55. | |
are included and I was interested in the minister's point that those | :03:56. | :04:00. | |
earning over 6000 could access master trust savings. Could the | :04:01. | :04:07. | |
minister right to me or maybe say to the house and clarify the policy on | :04:08. | :04:11. | |
this point and tell the House what the government is doing to ensure | :04:12. | :04:16. | |
eligible people are aware of this particular right under the law. | :04:17. | :04:21. | |
Those on low income will need to be addressed. I hope the government | :04:22. | :04:25. | |
will go further than freezing the trigger threshold as appears to be | :04:26. | :04:29. | |
their approach and lower it to ensure many more are included in | :04:30. | :04:35. | |
master trust saving. I met with Royal London last week and they | :04:36. | :04:39. | |
posed the question why every pound earned is not taken into account for | :04:40. | :04:44. | |
employer and employee contributions, is this something the minister would | :04:45. | :04:54. | |
add to the review? Share action have contacted me about auto enrolment at | :04:55. | :05:01. | |
and said they believe the second phase needs to be focused on | :05:02. | :05:07. | |
governance, choice and communication, getting people | :05:08. | :05:11. | |
engaged with their pension savings. Does the minister agree? Given his | :05:12. | :05:14. | |
responses on the expansion of eligibility for auto enrolment I | :05:15. | :05:20. | |
fail to see why the government wouldn't accept the clause. Should | :05:21. | :05:25. | |
he be committed to enfranchising these groups into master trust | :05:26. | :05:31. | |
savings why not make it clear in the legislation today? I turn to | :05:32. | :05:36. | |
amendment one which applies to the whole industry and that is the issue | :05:37. | :05:41. | |
of transparency. Opening the second reading debate on the Bill, the | :05:42. | :05:45. | |
Secretary of State said, transparency is a key area, hidden | :05:46. | :05:49. | |
costs and charges often they wrote pensions. We are committed to giving | :05:50. | :05:55. | |
members site of the costs that affect pension savings. On that we | :05:56. | :06:00. | |
agree and I am pleased he put it on the public record that costs erode | :06:01. | :06:07. | |
savers' pensions. That is a line in the 2015 Dutch central bank report | :06:08. | :06:13. | |
which said, investment costs are an important determinant of pension | :06:14. | :06:17. | |
fund performance, and high investment costs can impact | :06:18. | :06:21. | |
beneficiaries consumption as to reduce the net rate of return on | :06:22. | :06:24. | |
investment and subsequently raise the costs of providing pensions. | :06:25. | :06:29. | |
Despite this the Secretary of State's statement, the government | :06:30. | :06:35. | |
have resisted any attempt to do something, always missing something | :06:36. | :06:39. | |
may be done but never doing very much. The government hides behind | :06:40. | :06:45. | |
the issue of complexity but it has been glaciated with the investment | :06:46. | :06:48. | |
association the tools to deal with that. The area of pension funds | :06:49. | :06:58. | |
ready to be analysed is the local government pension scheme. It is due | :06:59. | :07:01. | |
to be endorsed by the minister to ensure they deliver best value for | :07:02. | :07:05. | |
sponsors and members. The architecture to get the data analyse | :07:06. | :07:11. | |
it and present it is the same process of discussion with a view to | :07:12. | :07:14. | |
being built on the former platform for which other projects including | :07:15. | :07:21. | |
value for money analysis needed for all workplace pensions and that can | :07:22. | :07:24. | |
be delivered. I believe the minister is a fan of this work and I would | :07:25. | :07:29. | |
hope he and the government would rise the easiest and most efficient | :07:30. | :07:35. | |
way to ensure the data for master trust is adopted is to adopt the | :07:36. | :07:41. | |
investment cost templates sanctioned by the DC LG and data points agreed | :07:42. | :07:54. | |
with association members. The purpose of this amendment is to lay | :07:55. | :07:58. | |
down the reporting obligations of master trusts. At the moment they | :07:59. | :08:03. | |
only report on administration and asset management fees. The amendment | :08:04. | :08:10. | |
requires additional reporting off implicit costs. The only obstruction | :08:11. | :08:15. | |
to this process is the government. It is contradictory. Why have it in | :08:16. | :08:20. | |
one section of the system and not in another? We believe the government | :08:21. | :08:23. | |
is holding back the scheme member from getting best value. The | :08:24. | :08:29. | |
employers in master trusts cannot deliver under current arrangements. | :08:30. | :08:32. | |
There is nothing simpler than setting out a requirement for the | :08:33. | :08:40. | |
reporting of explicit and this implicit costs. Members must be able | :08:41. | :08:44. | |
to discern the impact of trading on funds. The minister said, what | :08:45. | :08:53. | |
members mentioned makes the point not that active fund managers have | :08:54. | :09:02. | |
more costs. This is what was actually reported. Comparing the net | :09:03. | :09:07. | |
return on a ?20,000 investment over 20 years, assuming that both funds | :09:08. | :09:14. | |
had the same return before charges, and invested in a typically low-cost | :09:15. | :09:22. | |
fund would earn ?9,554, and improvement of 28.4%. More on a | :09:23. | :09:29. | |
?20,000 investment than a typical active fund and this number could | :09:30. | :09:38. | |
rise to ?14,439 or an increase of 44.4% once transaction costs have | :09:39. | :09:42. | |
been taken into account. The evidence is clear, investing in a | :09:43. | :09:46. | |
low-cost passive fund delivers more returned than an active fund, which | :09:47. | :09:51. | |
is why it is important to have the reporting requirements changed. We | :09:52. | :09:55. | |
can look to the Netherlands experience. It is a requirement of | :09:56. | :10:01. | |
Dutch funds to report on administration and management and | :10:02. | :10:04. | |
transactions. The Society of pension professionals agree and they say the | :10:05. | :10:08. | |
key is to ensure information given to consumers is sufficient to | :10:09. | :10:12. | |
empower them and provide customers with comparisons to enable them to | :10:13. | :10:15. | |
choose the best product and providers. This amendment helps the | :10:16. | :10:22. | |
government. Master trusts and scheme members to match the best in | :10:23. | :10:31. | |
practice reporting model. Another two is another to increase | :10:32. | :10:34. | |
transparency and ensure members are properly informed. In this case if | :10:35. | :10:38. | |
triggering event the pension in place. The minister replied to the | :10:39. | :10:45. | |
tabling of this amendment with the assumption members were passive | :10:46. | :10:50. | |
recipients. He said, remember, my members do not take an active | :10:51. | :10:54. | |
decision to join, they join through the employer and are not engaged in | :10:55. | :10:59. | |
the scheme, their employer is the conduit. Such a paternalistic | :11:00. | :11:04. | |
approach to citizens a disservice. The government rejects attempts to | :11:05. | :11:07. | |
reform the Bill to make it member focused. This approach labels | :11:08. | :11:14. | |
members as passive and not engage participants get the government | :11:15. | :11:17. | |
policy is to place responsibility on the individual to take care of their | :11:18. | :11:22. | |
pension provision. They seem to be standing in the way of members being | :11:23. | :11:27. | |
given information that would allow them to make informed decisions. Why | :11:28. | :11:33. | |
is this policy so contradictory? The pension pot is theirs, not the | :11:34. | :11:39. | |
employers' so they should buy right have natural justice and be | :11:40. | :11:44. | |
informed. Here we seek to ensure the information flows through the | :11:45. | :11:50. | |
communication chain. If they found out such an event happened, | :11:51. | :11:55. | |
something that affects their cash, and only found out second-hand, it | :11:56. | :11:59. | |
is bound to result in lower levels of trust. How would honourable | :12:00. | :12:03. | |
members feel if no one told them there was an issue over their | :12:04. | :12:08. | |
pension? It is a simple chain. If it can go to employers, it should go to | :12:09. | :12:13. | |
members and in this electronic age there is no good reason for that not | :12:14. | :12:19. | |
to happen. I would like to turn to amendment four in relation to pause | :12:20. | :12:25. | |
orders, which is about responsibility to scheme members. A | :12:26. | :12:32. | |
pause order is put in place by the regulator if they are satisfied | :12:33. | :12:36. | |
making the order will help trustees carry out an implementation | :12:37. | :12:45. | |
strategy, and during the committee stage of this Bill labour submitted | :12:46. | :12:50. | |
an amendment because it felt there was not enough protection in the | :12:51. | :12:54. | |
event of a master trust being pause. I give the example of a hypothetical | :12:55. | :12:58. | |
elderly woman who relied on her pension from the master trust and | :12:59. | :13:02. | |
had little income without it. A pause order can last up to six | :13:03. | :13:07. | |
months whereby the master trust can opt not to pay up pensions, | :13:08. | :13:12. | |
potentially six months that elderly people would have to find | :13:13. | :13:16. | |
alternative means to survive and that is not acceptable. I referred | :13:17. | :13:21. | |
to a circumstance where an elderly woman has not been informed of the | :13:22. | :13:24. | |
order as there seems to be no requirement for anybody to inform | :13:25. | :13:30. | |
her. I pose this question to the minister, and I was grateful for his | :13:31. | :13:36. | |
reply in which she said existing legislation ensures the regulator | :13:37. | :13:42. | |
will notify any person who is to be affected by action is exercised | :13:43. | :13:43. | |
through the statutory internal procedures. I hope he will clarify | :13:44. | :13:50. | |
when the scheme member would be informed. I think it is appalling | :13:51. | :13:57. | |
pensioners are denied access to their own pension money in such | :13:58. | :14:02. | |
circumstances. I have been assured members are protected in this | :14:03. | :14:06. | |
situation, even in the event of an order. If this is the case, why | :14:07. | :14:13. | |
would the master trust be unable to make payments to pensioners who | :14:14. | :14:17. | |
might be vulnerable. It strikes me as bizarre that this government is | :14:18. | :14:22. | |
calm about the potential repercussions on the vulnerable if | :14:23. | :14:27. | |
payments stopped. The minister said stopping payments would only happen | :14:28. | :14:32. | |
in rare circumstances. I hope he will take the opportunity of telling | :14:33. | :14:36. | |
the house what the circumstances could be and provide members with an | :14:37. | :14:40. | |
assurance they will not lose out during a pause order. We would amend | :14:41. | :14:45. | |
the clause and his sister pensioners are able to receive payments. I | :14:46. | :14:53. | |
submitted the new amendment three because I am concerned the pausing | :14:54. | :14:58. | |
of payments under an order is fundamentally against the aims of | :14:59. | :15:00. | |
what auto enrolment sought to achieve. The Bill as it stands would | :15:01. | :15:06. | |
mean if an order was put on a master trust it would no longer receive | :15:07. | :15:10. | |
contributions from the employer or employee and I note there is a | :15:11. | :15:17. | |
similar amendment from the SNP. I believe we are trying to achieve the | :15:18. | :15:20. | |
same things but not as they chat among themselves at the moment but I | :15:21. | :15:24. | |
am sure they are trying to achieve the same things. Whilst I agree with | :15:25. | :15:29. | |
the measure that master trusts would be in no fit state to continue | :15:30. | :15:35. | |
taking contributions, I do not agree that as a result members will get | :15:36. | :15:40. | |
contributions back into their pay packet and employers let off making | :15:41. | :15:45. | |
contributions. This amendment insures contributions made by the | :15:46. | :15:51. | |
employee and employer are not lost. This is important when we look at | :15:52. | :15:55. | |
low earners and a potential six-month pause order could see them | :15:56. | :16:00. | |
lose out on vital contributions. The minister may think a pause order is | :16:01. | :16:06. | |
unlikely to last six months but it can. The amendment proposes that in | :16:07. | :16:14. | |
the event of an order the employer would maintain the contributions | :16:15. | :16:20. | |
until the order is lifted. Maybe the contributions could be said by | :16:21. | :16:28. | |
themselves, it could be argued, but why, through no fault of their own | :16:29. | :16:32. | |
should they lose contributions to their pensions? Does the minister | :16:33. | :16:37. | |
agree workers should not lose out on contributions during a pause order? | :16:38. | :16:42. | |
I am concerned that if we don't put the measures in place to protect | :16:43. | :16:47. | |
people, even with the small chance something might go wrong, we will | :16:48. | :16:53. | |
have failed them. I am concerned the lack of transparency in this scheme | :16:54. | :16:58. | |
is a problem and concerned the problems lie with ensures companies | :16:59. | :17:04. | |
and master trusts and I am concerned about the low-paid, person with | :17:05. | :17:09. | |
multiple jobs, the self-employed, carers, who have not been looked | :17:10. | :17:13. | |
after by this Bill and I am concerned the government have missed | :17:14. | :17:20. | |
out on the fonder of last resort clause. I look forward to his | :17:21. | :17:32. | |
response -- funder of last resort. The question is the new clause one | :17:33. | :17:39. | |
be read a second time. I rise to move new clauses six, seven, eight | :17:40. | :17:45. | |
and nine, and amendments, five, six, seven, eight and nine. There is much | :17:46. | :17:51. | |
in this Bill I would commend. It introduces regulation for master | :17:52. | :17:54. | |
trusts that will help shake confidence in pension savings, | :17:55. | :17:59. | |
typically for auto involvement. As that committee stage we sought to | :18:00. | :18:03. | |
work with the government to bring forward clauses and amendments to | :18:04. | :18:09. | |
enhance the Bill as well as dealing with other shortcomings in pension | :18:10. | :18:14. | |
is appropriate to the Bill. I am disappointed the new clauses ten and | :18:15. | :18:17. | |
11 were not selected for debate. The minister knows my view that my | :18:18. | :18:25. | |
approach is to work constructively where we can to encourage consumer | :18:26. | :18:31. | |
participation and whilst there is much elsewhere, I would like to see | :18:32. | :18:36. | |
greater clarity delivered on, I congratulate the government and the | :18:37. | :18:37. | |
list of bringing the Bill forward. It is an important step forward | :18:38. | :18:48. | |
atten Hans egg the appeal of auto enrolle. It is important that we | :18:49. | :18:52. | |
take the opportunity of this legislation, to make sure that we | :18:53. | :18:56. | |
have the appropriate regulatory steps in place. I would encourage | :18:57. | :19:03. | |
that when we do review it, we look positively how we can take it | :19:04. | :19:07. | |
forward, for part-time workers, those who have been excluded, many | :19:08. | :19:12. | |
with multiple job, particularly Westminster and the self-employed. | :19:13. | :19:16. | |
Charting a way ford that builds pension entitlement in the way that | :19:17. | :19:22. | |
builds consensus, perhaps avoiding the screeching U-turn we saw from | :19:23. | :19:26. | |
the minister's colleague the Chancellor in recent days. | :19:27. | :19:30. | |
Mr Deputy Speaker, this is a serious subject, and this bill should be | :19:31. | :19:36. | |
seen as part of a wider debate, as how we increase panion savings. -- | :19:37. | :19:43. | |
pension. I was struck to read in the Government's Green Party paper on | :19:44. | :19:47. | |
defined benefit schemes that the average defined benefit scheme | :19:48. | :19:53. | |
payment is as little ass ?7,000 per annum. We have a paper highlights | :19:54. | :20:02. | |
income changes threatening pension freedom. It is clear that | :20:03. | :20:08. | |
collectively, there is more to do to encourage trust and confidence in | :20:09. | :20:13. | |
pension save, and in particular, that all are encouraged to save at | :20:14. | :20:17. | |
an appropriate level to ensure dignity in retire. E. We on these | :20:18. | :20:22. | |
benches will work with the Government on this agenda. | :20:23. | :20:27. | |
In the meantime, this bill is a welcome step forward. I hope that in | :20:28. | :20:35. | |
the spirit of engaging positively, the minister will give careful | :20:36. | :20:39. | |
consideration to the amendment that we have tabled. There should be seen | :20:40. | :20:43. | |
as clauses an amendment that seek to improve the bill, they are not any | :20:44. | :20:48. | |
any way shape or form wrecking amendments. Let me start with new | :20:49. | :20:53. | |
clause six, this new clause makes provision for the Secretary of State | :20:54. | :20:56. | |
to restrict exit fees paided by member, it is not clear to us why | :20:57. | :21:01. | |
master trust members should have to pay any exit charges. It is welcome | :21:02. | :21:06. | |
that the government are placing a 1% cap on exit fee for current members | :21:07. | :21:12. | |
and no exit fee for new member, however, why the threat of exit fees | :21:13. | :21:16. | |
for existing members? We know that large fees have been charged on exit | :21:17. | :21:21. | |
in the past, and it is clear we need to protect savers. I asked the | :21:22. | :21:25. | |
minister to confirm at earlier stage there's would be no exit fee for an | :21:26. | :21:29. | |
individual leaving a master trust. The minister responded, that when a | :21:30. | :21:33. | |
master trust was closing, it could not Levy a charge, but I would | :21:34. | :21:38. | |
appreciate if he would make it explicit that fees should not be | :21:39. | :21:44. | |
levied in all case, as far as new clause 7, 8 and 9 are concerned. 7 | :21:45. | :21:48. | |
would require the Secretary of State to make provisions to amend Section | :21:49. | :21:55. | |
75 of the Pensions Act 1995, in order to protect unincorporated | :21:56. | :21:59. | |
business, those at risk of losing personal assets, including their | :22:00. | :22:03. | |
homes. New clause eight would require within six months calendar | :22:04. | :22:06. | |
time from the date of which this act comes into force, the Secretary of | :22:07. | :22:11. | |
State must conduct a are view of the actual mechanism used to value | :22:12. | :22:15. | |
pensions schemes liabilities under Section 75 of the pensions act 1995. | :22:16. | :22:21. | |
A new clause nine, would compel the Secretary of State that must by | :22:22. | :22:26. | |
regulation exclude from the calculation of the act, the orphan | :22:27. | :22:30. | |
debt and any non-associated multi-employer scheme. | :22:31. | :22:37. | |
Mr Deputy Speaker, these am momentment would help deal with the | :22:38. | :22:45. | |
situation of plumbers in Scotland. -- amends. The scheme is managed by | :22:46. | :22:50. | |
a group of directors and appointees from the association of plumbing and | :22:51. | :22:55. | |
heating contractors in England and Wales. The scheme has over 36,000 | :22:56. | :23:01. | |
members and assets is in excess of 1.5 billion. Under Section 75 of the | :23:02. | :23:08. | |
Pensions Act 1995, employers can in certain circumstances become liable | :23:09. | :23:12. | |
for what is known as a Section 75 employer debt. The debt is | :23:13. | :23:18. | |
calculated on a basis which tests whether there would be sufficient | :23:19. | :23:22. | |
assets in the scheme to secure all the member benefits by buying | :23:23. | :23:27. | |
annuity contract from an insurance company. Legislation specifies a | :23:28. | :23:33. | |
debt becomes payable when the employer becomes insolvent, winds | :23:34. | :23:38. | |
up, changes legal status or ceases to have active members in the | :23:39. | :23:41. | |
scheme. While we must be mindful that the purpose of these rules is | :23:42. | :23:46. | |
to protect pension benefit, however, the way they are currently framed | :23:47. | :23:50. | |
creates problems for some stakeholder, we are sympathetic to | :23:51. | :23:55. | |
the concerns raised... I will happily give way. Does he I degree | :23:56. | :23:59. | |
with me it is because of such examples of those he has already | :24:00. | :24:04. | |
touched on of unincorporated businesses, that it so pertinent | :24:05. | :24:08. | |
right now as to why the Government has to bring forward a solution now | :24:09. | :24:12. | |
rather than wait for the opportunity to pass? I am grateful for my | :24:13. | :24:17. | |
honourable friend and she is right, I mean these are complex issue, that | :24:18. | :24:24. | |
is why we make the the suggestion we are willing to work with the | :24:25. | :24:27. | |
Government on this, we have to find a solution to this, at the end of | :24:28. | :24:30. | |
the day ordinary people who have done the right thing, are being | :24:31. | :24:33. | |
faced with losing their house and that cannot be right. It is an issue | :24:34. | :24:38. | |
that has to be resolved. There are a number of options for the government | :24:39. | :24:42. | |
to consider, each one has complications for the pension | :24:43. | :24:46. | |
schemes and members, we would urge the UK Government to weigh up the | :24:47. | :24:50. | |
interest of employers with the need to protect benefits for pension | :24:51. | :24:57. | |
schemes. The former pension minuter in in the other place indicate shd | :24:58. | :25:00. | |
woe would look at how a solution could be reached. We need the same | :25:01. | :25:06. | |
assurances from the minister he will work to find a solution and use the | :25:07. | :25:17. | |
bill to bring forward a solution. Mr Deputy Speaker, their main concern | :25:18. | :25:23. | |
is for unincorporated businesses, who are at risk of losing their | :25:24. | :25:27. | |
personal asset, for government to conduct a review of the real methods | :25:28. | :25:31. | |
used to value pension schemes liabilities, as they believe the | :25:32. | :25:36. | |
calculation of Section 75 employerer debt on a full anew the I basis is | :25:37. | :25:44. | |
detrimental to schemes given current circumstances. They argue that | :25:45. | :25:49. | |
orphan debt and multi-employer schemes should be excluded from the | :25:50. | :25:53. | |
calculation of Section 75 employer debt and they suggest provided the | :25:54. | :26:00. | |
scheme is deemed to be prudently funded the PPF acts as guarantor of | :26:01. | :26:05. | |
last resort. They believe any changes in legislation should apply | :26:06. | :26:08. | |
are the speck thetively to all employers from 2005. It would be | :26:09. | :26:14. | |
helpful to get the Government's view on this request. Mr Deputy Speaker, | :26:15. | :26:20. | |
snip F met with the minister and advised SNP MPs that the minister | :26:21. | :26:24. | |
confirmed that the objectors may have been incorporated within the | :26:25. | :26:28. | |
green paper. We are interested to hear the Government's view as to | :26:29. | :26:32. | |
whether or not it has identified the solution. Briefly I want to make | :26:33. | :26:37. | |
passing reference to my two new clawses that have not been selected | :26:38. | :26:42. | |
for debate. I wanted to signal my disappointment and put it on the | :26:43. | :26:46. | |
record. Firstly beginning with new clause ten, this new clause would | :26:47. | :26:53. | |
require the ebbing is triof state to require... State ten pension age | :26:54. | :26:56. | |
equalisation, we have disappointed that a pension bill has not been | :26:57. | :27:01. | |
brought forward to deal with this. Give way on that please? I will | :27:02. | :27:08. | |
happily give way. Does the honourable member agree with with me | :27:09. | :27:12. | |
that Government are ignoring this opportunity much like they are | :27:13. | :27:19. | |
ignoring the women themselves? We don't discuss clauses we have not | :27:20. | :27:23. | |
chosen, we have to deal with what is before us, I know you want to stay | :27:24. | :27:29. | |
an order, not the ones that have been o mid. Thank you Mr Deputy | :27:30. | :27:34. | |
Speaker. I am happy for the guidance you have given me. I wanted to put | :27:35. | :27:39. | |
on the record we have missed the opportunity today and I hope and I | :27:40. | :27:44. | |
know we will have the opportunity to raise this issue again, so I will | :27:45. | :27:50. | |
skip on from making any further reference to these two issues. We | :27:51. | :27:58. | |
believe the we need to build on new opportunities such as autoenrolment. | :27:59. | :28:02. | |
By giving pensions thoughtful time and consideration can the Government | :28:03. | :28:06. | |
get this right. With I alarm bells ringing over injustices facing it | :28:07. | :28:10. | |
and concerned we could see a hike in state pension age, the contemplation | :28:11. | :28:15. | |
that the triple lock would be reviewed is deeply troubling. We | :28:16. | :28:21. | |
know, if I may say so by delivering an independent Scotland we can | :28:22. | :28:26. | |
deliver the dignity in retirement our Marine Le Pennioners would need. | :28:27. | :28:30. | |
Amendment five would mean the financial sustainlet must be taken | :28:31. | :28:35. | |
into account, when assessing a master trust scheme's financial | :28:36. | :28:39. | |
sustainability. The ABI have told us insurance companies hold a | :28:40. | :28:44. | |
significant amount of capital under the European regulatory framework. | :28:45. | :28:49. | |
Our view, it would not be reasonable not nor is it necessary for insurers | :28:50. | :28:52. | |
to hold separate or additional capital on top of this in order to | :28:53. | :28:57. | |
meet their new obligation as trust providers under the bill. We would | :28:58. | :29:02. | |
like to hear assurances from the Government that insurers will be | :29:03. | :29:08. | |
exempt if they adhere to requirements. As far as amendment | :29:09. | :29:14. | |
six and seven are concerned. 6 allowings for exceptions to the | :29:15. | :29:18. | |
requirement for scheme funders... For which it is a scheme funder. | :29:19. | :29:25. | |
Amendment seven makes provision for the Secretary of State to define | :29:26. | :29:29. | |
restrictive activity by regulation including a list of actives | :29:30. | :29:32. | |
restricted to minimise the loss of master trust scheme funders. | :29:33. | :29:35. | |
These amendments a knowledge there must be circumstances where the | :29:36. | :29:40. | |
scheme funder requirements within the bill should not apply. The -- | :29:41. | :29:48. | |
already restricted by virtue of the existing regulation, the ABI have | :29:49. | :29:52. | |
said in particular the proden shall regulation authority riles mean | :29:53. | :29:56. | |
activity of the scheme funder not directly related to master trust | :29:57. | :30:04. | |
fund are not threatened. The ABI have said this is sensible and a | :30:05. | :30:08. | |
pragmatic approach. It would be useful to understand what a | :30:09. | :30:13. | |
requirement will need backbench met for firms fob exempt from the scheme | :30:14. | :30:16. | |
funder requirement. It would be helpful to gain assurance that the | :30:17. | :30:22. | |
Government is committed to working with the industry. As far as | :30:23. | :30:28. | |
amendment eight and nine, they provide the regulator with an | :30:29. | :30:31. | |
alternative to stopping payment to the scheme under sub section B of a | :30:32. | :30:37. | |
pause order. Nine is consequential to 8678 the bill created a new power | :30:38. | :30:43. | |
enabling the regulator to make a pause order requiring activety to be | :30:44. | :30:47. | |
paused once a trust has experienced a triggering event. This includes | :30:48. | :30:55. | |
accepting new members making payments, accepting contribution and | :30:56. | :30:59. | |
discharging benefit. We accept the impact as there is no mechanism | :31:00. | :31:03. | |
plays on outgoing contribution to be collected and held on behalf of the | :31:04. | :31:08. | |
save. We would contend this is unacceptable a member be penalised | :31:09. | :31:11. | |
through no fought of their own and in effect lose wages in the form of | :31:12. | :31:17. | |
employer contributions due to events out with their control. The society | :31:18. | :31:21. | |
of pension professionals have said it will be necessary to ensure that | :31:22. | :31:25. | |
the period of effect of a pause order cannot start before the | :31:26. | :31:29. | |
trustees receive notification of the pause order. This would then mean | :31:30. | :31:33. | |
that any controversial order could only occur after the trustees are in | :31:34. | :31:38. | |
receipt of the order. Without this, the they argue that the trustees | :31:39. | :31:42. | |
could be in breach of a pause order through no fault of that own. If a | :31:43. | :31:45. | |
direction is not complied with during the period between one, the | :31:46. | :31:49. | |
date the regulator makes the order and two, the date they notify the | :31:50. | :31:54. | |
trustees of it. For example, if new members joined the scheme in that | :31:55. | :31:59. | |
period, contrary to direction under clause 32 five A. The Government | :32:00. | :32:05. | |
should clarify if the intent to take action to protect savers now were | :32:06. | :32:10. | |
disappointed at amendments were defeated at earlier stages. Mr | :32:11. | :32:14. | |
Deputy Speaker, I look forward tore happening the minister respond, we | :32:15. | :32:18. | |
have sought to work with the Government in hand with the bill we | :32:19. | :32:22. | |
have in front of us today that we broadly welcome. We affirm or | :32:23. | :32:26. | |
position of working with the Government to create an environment | :32:27. | :32:31. | |
where workers can with have faith and trust. We should have a desire | :32:32. | :32:36. | |
to develop the landscape for pension savings and to achieve a situation, | :32:37. | :32:40. | |
that all pensions from their provision and the state pension | :32:41. | :32:43. | |
could have dignity and security in retirement. | :32:44. | :32:46. | |
This bill helps us awe long that road as far as regulation of master | :32:47. | :32:50. | |
trusts is concerned. There is more to do to enhance autoenrolment and I | :32:51. | :32:54. | |
look forward to working with the Government to take steps to include | :32:55. | :33:00. | |
those currently excluding from pension safes, particularly the | :33:01. | :33:03. | |
self-employed and part-time workers, in closing, while I welcome this | :33:04. | :33:08. | |
bill today, I also reflect on the necessity of having had to put down | :33:09. | :33:13. | |
a motion last night, on the issue of frozen pension after the Government | :33:14. | :33:16. | |
had brought forward a statutory instrument to freeze the pensions of | :33:17. | :33:20. | |
hundreds of thousands of British pensioners who have been denied | :33:21. | :33:24. | |
their rites. In pushing this through, the Government have denied | :33:25. | :33:26. | |
the right to members of this house to debate this matter. I encourage | :33:27. | :33:32. | |
all honourable members and right honourables to send it and as | :33:33. | :33:36. | |
believe we can demonstrate broad cross-party support against this | :33:37. | :33:38. | |
measures the Government will have the grace to bring forward the | :33:39. | :33:42. | |
debate on this matter, before recess. This EDM has been signed by | :33:43. | :33:46. | |
members from six parties, including the government. I would encourage | :33:47. | :33:49. | |
the Government to listen to this matter as part of the process of the | :33:50. | :33:51. | |
bill today. Thank you. Auto o a youed Thank you very much, | :33:52. | :34:10. | |
Mr Deputy Speaker. I would like to thank the, well I would like to | :34:11. | :34:14. | |
thank the honourable members for their amendments. I would like to | :34:15. | :34:18. | |
say, Mr Deputy Speaker, and I hope all would agree in this House, that | :34:19. | :34:24. | |
have been following this debate here, and in committee, that the | :34:25. | :34:29. | |
attitude of the Government has been to oppose all amendments just for | :34:30. | :34:34. | |
the sake of it. I give honourable members my word that that everything | :34:35. | :34:40. | |
has been considered. But it's Government's job to consider the | :34:41. | :34:47. | |
kind of o lobbying from comes from the many oxes that the honourable | :34:48. | :34:52. | |
member for Stockton North mentioned several times and I have also met | :34:53. | :34:57. | |
with most of them as I'm sure the honourable member from Ross Skye has | :34:58. | :35:02. | |
as well but it is the Government's job to weigh up everything and make | :35:03. | :35:06. | |
a decision. I mention that because I hope all agree that it is the | :35:07. | :35:11. | |
position that the Government finds itself. But I'm really quite | :35:12. | :35:17. | |
disappointed that we are, today, really almost exclusively revisiting | :35:18. | :35:20. | |
exactly the same amendments that we saw at committee and my arguments | :35:21. | :35:25. | |
remain unchanged. That doesn't mean I'm going to sit down anyhow and | :35:26. | :35:27. | |
ignore contributions from the previous speaker. I don't think that | :35:28. | :35:30. | |
would quite be the correct thing to do. The honourable gentleman, feel | :35:31. | :35:34. | |
free. No, I intend to go through in detail and try and answer some of | :35:35. | :35:42. | |
the questions which have been actually asked in very good faith | :35:43. | :36:10. | |
and try and answer them in exactly the same way. This is new clause 1, | :36:11. | :36:15. | |
as discussed in the other place, extensively discussed on committee | :36:16. | :36:18. | |
and very much considered by my officials and myself, this, would | :36:19. | :36:21. | |
require - Prince polyit would require the Secretary of State to | :36:22. | :36:24. | |
establish - principally it would require... | :36:25. | :36:26. | |
On the case of t the surface of t it seems a compelling argument. -- on | :36:27. | :36:30. | |
the face of it, on the surface of t and I must say having met with | :36:31. | :36:33. | |
Baroness drake and others before the Bill came to this House, considered | :36:34. | :36:36. | |
it very open mindlessly and I thought of all the points made it | :36:37. | :36:39. | |
was the most significant. I would also like to place on record, if I | :36:40. | :36:43. | |
may, Mr Deputy Speaker, that the distributions from the mobile Lords | :36:44. | :36:46. | |
has been very useful. I make that completely on a cross-party point of | :36:47. | :36:50. | |
view. Particularly I would like to pay tribute to Baroness Drake, a | :36:51. | :36:54. | |
person I have met several times to discuss this with, but there are | :36:55. | :37:00. | |
disagreements, there are honourable disagreements, where the two | :37:01. | :37:05. | |
positions - and neither are ridiculous positions, all would | :37:06. | :37:07. | |
agree but in the end the Government has to decide and that's why I'm not | :37:08. | :37:13. | |
able to give the Opposition the comfort it expects or is asking for | :37:14. | :37:18. | |
on this. I would like to state very clearly that the whole purpose of | :37:19. | :37:22. | |
this regime, introduced by this Bill is intended to mitigate the very | :37:23. | :37:26. | |
risk that the honourable gentleman is concerned about and he is | :37:27. | :37:29. | |
honourably concerned about because it is a concern and very cliches | :37:30. | :37:35. | |
have been used in different opportunities in these Bills and as | :37:36. | :37:41. | |
this Bill has gone through, usually involving nuts and sledge Hammers | :37:42. | :37:51. | |
and other such matters but I would prefer, if I may, Mr Deputy Speaker | :37:52. | :37:55. | |
to say it is a question of being proportionate or not being | :37:56. | :37:57. | |
disproportionate. And I think that really summarises it up. Because the | :37:58. | :38:00. | |
master trust, because before it is actually authorised in the first | :38:01. | :38:07. | |
place, Mr Deputy Speaker, it has to have a regime, where the pensions | :38:08. | :38:12. | |
regulator has to be convinced that it thoos meet costs of triggering | :38:13. | :38:16. | |
events. Remember, Mr Deputy Speaker, as I'm sure you do, that this is not | :38:17. | :38:21. | |
involving the pensions money, this is involving the scheme, the actual | :38:22. | :38:25. | |
organisations that'p running the funds, so the pensions regulator has | :38:26. | :38:34. | |
to ensure that the organisers of the trust has sufficient cost of | :38:35. | :38:36. | |
triggering the event and therefore, should it fail, they have the money | :38:37. | :38:39. | |
to transport it out to another scheme. The regulator will monitor | :38:40. | :38:43. | |
this situation on an ongoing basis to ensure the funds remain | :38:44. | :38:47. | |
available. Currently, it is very interesting, in the markets, Mr | :38:48. | :38:52. | |
Deputy Speaker, the market is responding well to deal with | :38:53. | :38:56. | |
existing master trusts that wish to exit before authorisation. It is | :38:57. | :39:00. | |
interesting that the regulation itself, the threat of what will an | :39:01. | :39:05. | |
act, the threat of this bill, is making smaller masser trusts | :39:06. | :39:09. | |
consider whether they wish to be in this new world, this new regulated | :39:10. | :39:13. | |
world and several master trusts have left the market already in an order | :39:14. | :39:18. | |
fashion. The regulator is confident that there are currently none that | :39:19. | :39:21. | |
could not afford to transfer out members. I feel that's a very | :39:22. | :39:28. | |
important point. And I do hope the honourable gentleman from Stockton | :39:29. | :39:30. | |
North will take that into consideration when deciding whether | :39:31. | :39:33. | |
to press this amendment. We're working with the regulator on | :39:34. | :39:39. | |
non-legislative measures to address concerns of potential liabilities | :39:40. | :39:42. | |
and trustees of receiving schemes that might arise if a master trust | :39:43. | :39:47. | |
should end up in wind-up and honourable members should be aware | :39:48. | :39:50. | |
that we do have this system of regulation to make sure precisely | :39:51. | :39:53. | |
that this doesn't happen. Interestingly enough I'm afraid I'm | :39:54. | :39:58. | |
taking, in a ditch way a survey that I believe the honourable gentleman | :39:59. | :40:02. | |
from Stockton North mentioned in committee from Pension Professional. | :40:03. | :40:05. | |
They found 50% of those surveyed said they did not want a scheme of | :40:06. | :40:10. | |
last resort as opposed to the 31% of who said they did. It's very | :40:11. | :40:14. | |
interesting, the honourable gentleman mentioned in his speech | :40:15. | :40:19. | |
the Standard Life's view. I accept the fact that it is the view of | :40:20. | :40:23. | |
industry players that they would much rather help the Government step | :40:24. | :40:26. | |
in and deal with it. That's very natural. #3r0b8 if I was in their | :40:27. | :40:33. | |
position, I would. But we have also spoken toins stugss, people involved | :40:34. | :40:37. | |
in inrollment and people involved in master trusts, etc and my impression | :40:38. | :40:41. | |
is clearly there's plenty of players who would bite the hand off nigh | :40:42. | :40:50. | |
schemes that they could get hold off because from their point of view | :40:51. | :40:56. | |
they are making on members, which would involve them in very little | :40:57. | :40:59. | |
costs because there are already running the schemes and they have | :41:00. | :41:02. | |
the set up and everything else. I would say quite clearly that they | :41:03. | :41:06. | |
seem to be desperate to take on these schemes, I give way. | :41:07. | :41:12. | |
The minister is taking great comfort from the existing measures that are | :41:13. | :41:16. | |
in place but there is still no 100% guarantee that there'll be somebody | :41:17. | :41:21. | |
to pick up the costs of in the event of a trust failure. We could see a | :41:22. | :41:25. | |
new trust go through authorisation process and it could still fail | :41:26. | :41:31. | |
through bad management, fraud, whatever. Who is going to pick up | :41:32. | :41:37. | |
the pieces in that situation? Mr Deputy Speaker, we have to deal with | :41:38. | :41:40. | |
the reality of the situation and that is not happening. Yes, anything | :41:41. | :41:44. | |
can happen. We all know in life things happen. This Parliament deals | :41:45. | :41:49. | |
with things that happen all the time that no-one could possibly expect | :41:50. | :41:54. | |
the day before. I'm convinced, as the minister for pensions, that the | :41:55. | :41:57. | |
regulation that's taking place, the view of the industry that the | :41:58. | :42:02. | |
regulator takes, that we have had regular views, with, and speaking to | :42:03. | :42:07. | |
the type of institutions that with willingly take on failing master | :42:08. | :42:12. | |
trusts that there is no need for the Secretary of State to have, in his | :42:13. | :42:17. | |
desk drawer armoury, the money or the weapons to deal with it This is | :42:18. | :42:21. | |
a problem that really does not exist. And the honourable member | :42:22. | :42:26. | |
says it's all left to chance. Well, it isn't left to chance. We've got a | :42:27. | :42:31. | |
finite number of master trusts that exist now. We know - well, thanks to | :42:32. | :42:37. | |
the support of the Government and the Opposition and general support | :42:38. | :42:42. | |
of this Bill, that this Bill will be enacted I hope as quickly as | :42:43. | :42:51. | |
possible. So it is a finite open. It is not the contingent liability that | :42:52. | :42:55. | |
will happen in years to come. We know hopefully in two years, it is a | :42:56. | :43:00. | |
clear regulatory system in place and the regulator is clear about what | :43:01. | :43:03. | |
trusts do exist. So we have all taken really quite a lot of care it | :43:04. | :43:09. | |
make sure that this is not going to happen and I do feel that the | :43:10. | :43:14. | |
measures suggested in this amendment are totally disproportionate to the | :43:15. | :43:16. | |
problem and for those reasons, I would ask the honourable member to | :43:17. | :43:21. | |
withdraw his amendment, which I don't think he will, but I do ask | :43:22. | :43:26. | |
him. A little honesty from the despatch | :43:27. | :43:32. | |
box I'm very pleased to see at least I have served to amuse the | :43:33. | :43:35. | |
Opposition front bench on this case. But if I may turn to new clauses 2, | :43:36. | :43:46. | |
3 and 4 which are in the honourable gentleman' from Stockton North's | :43:47. | :43:53. | |
name to do with engagement and during committee and in | :43:54. | :43:55. | |
conversations on and off the record involving everyone who is concerned, | :43:56. | :43:58. | |
I have made it clear - which I'm sure you would expect, that member | :43:59. | :44:01. | |
engagement is important and that members should be encouraged to | :44:02. | :44:03. | |
develop a strong sense of ownership in their pension saving but I do, | :44:04. | :44:06. | |
howover, remain of the view that these amendments are unnecessary. -- | :44:07. | :44:10. | |
however. And I know the honourable gentleman is expecting me to say | :44:11. | :44:14. | |
this because these are points that we have, we have discussed before. I | :44:15. | :44:21. | |
would like to - I think my main rebuttal point would be to remind | :44:22. | :44:28. | |
the honourable gentleman that - to remind the honourable gentleman that | :44:29. | :44:34. | |
the majority of master trusts are subject to the rules on trustees in | :44:35. | :44:38. | |
the regulation of governments and those regulations require that the | :44:39. | :44:42. | |
schemes must have at least three trustees and the majority have to be | :44:43. | :44:46. | |
independent to provide service to the scheme. There must be an open | :44:47. | :44:53. | |
and transparent appointment process for recruiting independent trustees, | :44:54. | :44:56. | |
I agree but current arrangements ensure members have access to | :44:57. | :44:58. | |
appropriate information to make decisions about their pension | :44:59. | :45:03. | |
scheme. These include a mandatory annual benefit statement. For most | :45:04. | :45:06. | |
members a statutory money purchase illustration. That gives the members | :45:07. | :45:12. | |
a projection of their pension in retirement and what the honourable | :45:13. | :45:15. | |
gentleman says on request, he says it should be be on request but it is | :45:16. | :45:20. | |
available the trustee's annual report, the chair statement and the | :45:21. | :45:24. | |
statement of investment principles and the pensions regulator provides | :45:25. | :45:29. | |
guidance on trusteesees for communicating effectively and | :45:30. | :45:32. | |
transparently with their members. I would remind members in the House | :45:33. | :45:39. | |
that all trustees have these fiduciary duties. And other legal | :45:40. | :45:46. | |
requirements. Some master trusts are developing innovative ways for | :45:47. | :45:50. | |
engaging with members without overly prescriptive statutory requirements, | :45:51. | :45:54. | |
many of which I would like to say respectfully are of a general era, | :45:55. | :45:57. | |
than holding general meetings where people are expected to travel all | :45:58. | :46:00. | |
over the country and things like that. I would like to, very quickly, | :46:01. | :46:05. | |
discuss the points made about the auto inrollment review. If I may sum | :46:06. | :46:10. | |
prize by saying the purpose of the review -- summarise by saying the | :46:11. | :46:14. | |
purpose of the review is to discuss the points brought up by the | :46:15. | :46:17. | |
honourable member. We are looking very extensively about self-employed | :46:18. | :46:20. | |
people being included in it, by people of lower income. He mention | :46:21. | :46:25. | |
careers and I would like to point out that all careers now who are | :46:26. | :46:28. | |
employed are exactly the same as other people who are employed if | :46:29. | :46:31. | |
they fit into the criteria, they won't be. I wouldn't exclude at | :46:32. | :46:36. | |
looking at everything out. But it is a broad review, it is far, far braid | :46:37. | :46:42. | |
than it has to be as far as the law is concerned. If I may refer briefly | :46:43. | :46:50. | |
to the already honourable member's nements new clause 6 where he wants | :46:51. | :46:54. | |
to introduce a power to cap exit charges. We have said, as I have | :46:55. | :46:58. | |
said before, the power already exists because we are shed lating | :46:59. | :47:05. | |
the pensions act 2014, as amended by clause 41 of this bill and where by | :47:06. | :47:09. | |
existing powers the regulations are there to cap or ban early exit | :47:10. | :47:13. | |
charges in occupational schemes, including master trusts. And | :47:14. | :47:19. | |
existing members members of occupation schemes, of course are | :47:20. | :47:23. | |
eligible to the pension freedom if they have their charges capped at a | :47:24. | :47:28. | |
maximum of 1%. I do not think it is fair to exclude all charges because | :47:29. | :47:32. | |
the fact is that there are cost involved with exit. The new clauses | :47:33. | :47:39. | |
7 I, 8 and 9 introduced very eloquently, as ever, by the | :47:40. | :47:44. | |
honourable member from Rosses is Skye, they are seeking to make | :47:45. | :47:47. | |
changes in the provisions of the pension act which addressed the | :47:48. | :47:51. | |
issue of employer debt and defined benefit scheme. As he said, I've met | :47:52. | :47:57. | |
with representatives fted Plummers UK scheme and I have met with | :47:58. | :48:01. | |
stakeholders generally, employers and polies and I would like it make | :48:02. | :48:06. | |
it very clear that the issues raised on the green paper in sustainability | :48:07. | :48:10. | |
in our defined benefit pension schemes, there is a round table | :48:11. | :48:13. | |
represented from the relevant schemes to look at precisely what | :48:14. | :48:17. | |
changes to legislation may be needed. And it is a complex and | :48:18. | :48:22. | |
technical problem and there is no perfect solution because each | :48:23. | :48:24. | |
involves one of three parties taking responsibility for the debt. | :48:25. | :48:31. | |
The retired ones or the PPF. Each of have has its own problem, I do give | :48:32. | :48:39. | |
the honourable gentleman my work. I would like to congratulate him and | :48:40. | :48:44. | |
the work his colleagues have his party have done, it is not on deaf | :48:45. | :48:48. | |
airs and we will make progress on it. I trust the honourable member | :48:49. | :48:53. | |
will in fact withdraw those amendments. The new clause. | :48:54. | :48:58. | |
The honourable member for Stockton North, we have dealt with in | :48:59. | :49:02. | |
committee, the minimum requirement for annual reporting of | :49:03. | :49:05. | |
administration, etc, it is just something that we will have agree to | :49:06. | :49:12. | |
disagree on. We are committed to making regulations requiring | :49:13. | :49:14. | |
informational charges and trap axion costs to be provided to members in | :49:15. | :49:18. | |
the course of this Parliament. We will consult this year on the | :49:19. | :49:24. | |
publication of such information to members, the only consultation is | :49:25. | :49:29. | |
how, and not if in concerning disclosure, I also have read the | :49:30. | :49:33. | |
financial conduct's authority asset management market study. Sometimes | :49:34. | :49:37. | |
think the honourable member and I are the only people who have read it | :49:38. | :49:41. | |
in full detail, I am fully commend it. I have told the FCA and we it | :49:42. | :49:48. | |
will -- fully fwend to take action o on that. The Government processes | :49:49. | :49:52. | |
the necessary primary power and it is swell on its way to achieve the | :49:53. | :50:01. | |
stated purposement for that I would urge the honourable member to | :50:02. | :50:05. | |
withdraw his amendment. On scheme funder requirement, I will deal with | :50:06. | :50:12. | |
next. I have listened very carefully to that, he adds to the requirement | :50:13. | :50:18. | |
we put down in clause eight, that the mastertrust scheme has | :50:19. | :50:20. | |
sufficient financial resources for the scheme funder, but it is not | :50:21. | :50:25. | |
required, as the regulators assessment must take into account | :50:26. | :50:31. | |
matters specified in regulations which include insolvency risk, | :50:32. | :50:34. | |
enforceability of any funding commitped and whether the scheme | :50:35. | :50:37. | |
funder is subject to capital requirement. I do not believe we | :50:38. | :50:44. | |
need to expand the range of activity beyond that, because amendment six | :50:45. | :50:48. | |
and seven would expand it so that, it would expand the range of | :50:49. | :50:53. | |
activity that a scheme funder can undertake. | :50:54. | :50:57. | |
The Government's amendment we put four wad at committee mean that the | :50:58. | :51:01. | |
scheme funders no longer restricted solely to these activity related to | :51:02. | :51:04. | |
the mastertrust and I would remind him, as he has mentioned the ABI, | :51:05. | :51:10. | |
they welcome the cross-party consensus that needs to address the | :51:11. | :51:13. | |
issue and the common-sense approach the Government has taken to reflect | :51:14. | :51:19. | |
its concerns, in short, these amendments are not needed and I urge | :51:20. | :51:22. | |
very much the honourable member to withdraw them. | :51:23. | :51:27. | |
About the trigger events Mr Deputy Speaker. Amendment two requires the | :51:28. | :51:32. | |
trustees to notify scheme members that a triggering event has occur | :51:33. | :51:35. | |
confidence and of other information to be set out in regulation, I am | :51:36. | :51:40. | |
sure you are aware Mr Deputy Speaker, a triggering event is a | :51:41. | :51:43. | |
change in circumstanceses that poses a threat, a risk to the scheme, and | :51:44. | :51:50. | |
it is very important that I accept the fact, that members are informed | :51:51. | :51:53. | |
well ahead of something that directly impacts on him. Trustees | :51:54. | :51:58. | |
can inform members at the point of triggering events if they judge it | :51:59. | :52:02. | |
is appropriate. The bill requires if the scheme does proceed to wind it | :52:03. | :52:07. | |
it must inform members, I feel this is well meaning but inappropriate, | :52:08. | :52:10. | |
could be very costly and could indeed frighten members for no | :52:11. | :52:14. | |
reason, because the. System is well in place they would require later on | :52:15. | :52:19. | |
in the process to be informed. I would again ask the honourable | :52:20. | :52:24. | |
member to withdraw his amendment, as I would with pause orders mentioned | :52:25. | :52:32. | |
by the honourable member for sock on the north and the member for Ross, | :52:33. | :52:38. | |
Sky and locker. I have mastered it by report stage which is beyond the | :52:39. | :52:42. | |
call of duty. The amendment would require these | :52:43. | :52:46. | |
distributions which can't be paid into a mastertrust in the interim | :52:47. | :52:53. | |
period, to be basically held by the employer in a special account or | :52:54. | :52:57. | |
something like that. That is the amends from the honourable member | :52:58. | :53:04. | |
for Ross and Skye, in one sentence. It, the honourable member for | :53:05. | :53:07. | |
Stockton North removes the position to halt payments to members from a | :53:08. | :53:10. | |
scheme during a pause order, I just would like to make clear, the | :53:11. | :53:14. | |
Government's position is that employees should retain their | :53:15. | :53:17. | |
contributions they made during a period, and receive a refund from | :53:18. | :53:21. | |
their employer, if those have already been ducted but can't be | :53:22. | :53:24. | |
paid over for the scheme, into the scheme. I think we have made it | :53:25. | :53:28. | |
clear, always, we, everyone would agree it is a rare and time limited | :53:29. | :53:33. | |
situation, which has a low risk of occurring, and it is quite a big | :53:34. | :53:41. | |
burden, that would go with it. The, yes. On this issue and the issue of | :53:42. | :53:47. | |
pause orders and payment, I was referring to impayment from the | :53:48. | :53:50. | |
pension, we are talking about the payment of pensions not the refund | :53:51. | :54:00. | |
of contributions to the employee. Yes, I do, thank you very much for | :54:01. | :54:04. | |
clarifying that. I think the honourable member for Stockton | :54:05. | :54:08. | |
North. The trustees can decide when they have to decide when they wish | :54:09. | :54:12. | |
to notify members of a pause order. It is not like it doesn't exist, I | :54:13. | :54:17. | |
would remind the honourable member that the T PR can direct the | :54:18. | :54:20. | |
trustees to notify the members at any time if they deem it necessary. | :54:21. | :54:26. | |
I really they is an important point. So, that power is already there. It | :54:27. | :54:31. | |
is not as if it is going away. Having said all that, I have really | :54:32. | :54:37. | |
considered everything, but I think I have made the arguments myself, and | :54:38. | :54:41. | |
I would trust and hope the honourable member would withdraw his | :54:42. | :54:45. | |
amendment. Mr Deputy Speaker, I am satisfied that the bill has been | :54:46. | :54:48. | |
improved by amends made at committee and I would like to say largely in | :54:49. | :54:53. | |
response to opposition argument, once it becomes an act I think will | :54:54. | :54:59. | |
provide an effective protection for the millions saving in mastertrusts | :55:00. | :55:03. | |
largely as a result of the success of autoenrolment. I hope today this | :55:04. | :55:09. | |
House will be conten tent to leave it unamended. Division, clear the | :55:10. | :55:18. | |
lobbies. Order. The question is that new | :55:19. | :56:11. | |
clause one be read a second time as many of that opinion say aye. The | :56:12. | :56:17. | |
contrary no. Tellers for the ayes Nick Smith and Jeff Smyth. For the | :56:18. | :56:25. | |
noes Chris Pincher and Chris Eton Harris. | :56:26. | :56:28. |