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Mr. Steve Webb (Northavon): Sometimes we have had cause to agree with the Conservatives' analysis of the pensions issue. One phrase in their motion "shocked by the Government's complacency" jumps out because it puts its finger on the pulse of the pension problem. The Government are indeed guilty of complacency on funded pensions. It is striking that relatively little of the Government amendment, on which we will vote later, is about funded pensions. Instead, the Government pat themselves on the back for £6 billion of state spending.
That goes to the nub of the problem, which is that the Government have set a target for increasing funded pensions, but appear to have almost no policy levers to deliver it. It is a paradox that for several years it has been
That, I regret to say, is where the consensus between the Liberal Democrats and the Conservatives breaks down. When I look at their motion, I see hand-wringing over measures that they oppose but would not reverse, and a very thin set of proposals for reform, some of which are agreed throughout the House and are not distinctive, and most of which are rather vague and do not amount to a row of beans.
Mr. John Butterfill (Bournemouth, West): Is the hon. Gentleman telling me that reversing that £5 billion of taxation is a Liberal Democrat policy, along with all the other pledges that they will never have the opportunity to implement?
Mr. Webb: Not at all. None of the three main political parties has included a reversal of that policy in its manifesto, and that is the point. It is dishonest of the Conservatives to keep whingeing, "Oh, it's terrible but if we had the chance to be in government, we wouldn't do anything about it." It is also a waste of our time. Let us talk about what they would do.
The Conservatives are in favour of cutting the burden of regulation, almost all of which they wrote. As for the regulations introduced since Labour was elected, will the hon. Member for Havant (Mr. Willetts) list which of them the Conservatives voted against? I put it to him that his party has supported the vast majority of pensions regulations introduced in recent years. I would give way, but there is no response. The Conservatives are weeping crocodile tears. They will not reverse the tax change to which they object; they voted for or waved through most of the extra regulation that they claim to oppose, and they wrote all the rest of it.
The Conservatives say that they want to reverse the spread of means-testing, and we share that desire. But is there a Conservative proposal to put money into the basic pension? When the pension credit was introduced, there was a suggestion that the money might go, quite properly in my view, to older pensioners through the basic pension. Is that current Conservative policy? Is it Conservative policy to put up the basic pension? It has suddenly gone very quiet. There is no such policy. There is a lot of hot air on this issue. The Conservatives complain about measures that they would not reverse or to which they have agreed.
Mr. Webb: We diverge on a number of points. The hon. Gentleman, the hon. Member for Havant and I addressed that conference, and the hon. Member for Havant said something intriguing that has not been picked up. I know that saying something on the Floor of the House is not a good way to get it publicised, but I will have a go.
The hon. Gentleman said on the record that pensioners currently get three means-tested benefits: income support, or whatever name it is known by these days; housing benefit, and council tax benefit. His view, and I am sure he will correct me if I misrepresent him, is that three is too many. The Conservatives would prefer there to be two benefits, and housing benefit is the one that he has in mind. The Conservatives are thinking of ending not only the basic state pension but housing benefit. If he wants to correct the record, I am happy to give way, but he explicitly said that we should go from three benefits to two, which, according to my arithmetic, must mean doing away with one.
The Conservatives suggest that there should be simplification. Alan Pickering, for whom I have a great deal of respect, has shrewdly spent a lot of time with the hon. Member for Havant, myself and people who have some influence in the pensions worldperhaps the hon. Gentleman and I do notgathering a consensus. I strongly suspect that when he makes his proposals they will attain cross-party support. It is true that we want simplification of regulation, but that is not a distinctive policy. Once that is done, what will be left of the Conservative proposals? They are getting a bit thinand we are nearing the end of the motion.
What is left? On reform of annuities, there is a specific proposal that will benefit a small number of people. We supported that proposal when it was set out in a private Member's Bill, but it will be largely irrelevant to the vast number of people who are suffering the loss of funded pensions now.
Mrs. Browning: I have to disagree with that statement. My constituency experience is that when it is explained to younger people being offered a stakeholder pension that they have to take it as an annuity, it puts them off signing up. That is why the take-up figures for stakeholder pensions are so small. I am talking not about people on high salaries, but about garage mechanics and people like that.
Mr. Webb: The hon. Lady misses the point. The private Member's Bill that I mentioned would not deal with such peopleit would be of absolutely no value to them. That is because the sort of pension pot that such folk could accumulate would not put them in the range of those who would benefit from having draw-down or greater flexibility. That proposal was the only example of
Mr. Gardiner: I am grateful. Is the hon. Gentleman aware that the Association of British Insurers has published data on the low earnings of those taking out stakeholder pensions, in contradistinction to the remarks made by the hon. Member for Tiverton and Honiton (Mrs. Browning)? The ABI says:
Mr. Webb: Not only do the majority of those taking out stakeholder pensions earn between £10,000 and £29,000, but the earnings of the majority of the working population range between those two figures. It is an extremely wide band, and it was not the original target for stakeholder pensions.
One of my concerns about the stakeholder scheme is that the ABI figures show that only one in three stakeholder pensions have been bought by a woman. One of the key features of the pensions debate is that women are almost invisible. Among today's pensioners and people approaching retirement age, it is always women who have grotty pensions or poor pension rights. My concern about the change from 40 to 60 per cent. private provision, which the hon. Member for Birmingham, Selly Oak (Lynne Jones) is right to challenge, is that it is likely to be detrimental to women. Greater reliance on funded but money-purchase pensions, in which people buy an annuitywhich is less for women than for menis likely to be detrimental to women's relative position.