The Parliamentary Under-Secretary of State, Department for Constitutional Affairs (Baroness Ashton of Upholland): My Lords, the judicial pension scheme will become a non-registered pension scheme in accordance with the provisions of the Finance Act 2004 on 6 April 2006. The details were set out in a Written Ministerial Statement made by my noble and learned friend the Lord Chancellor on 15 December 2005.
Lord Fowler: My Lords, I thank the Minister for that reply. Is not the effect of the changes to avoid the new pension law, introduced by this Government, which places a lifetime limit of £1.5 million on the capitalised value of anyone's total pensions benefits? That is not an ungenerous limit. Does she therefore think it is right that judges should be exempt from pension rules that apply to everyone else?
Baroness Ashton of Upholland: My Lords, as the noble Lord knows, the judiciary is covered by statute. As the responsible Minister, my noble and learned friend looked at what was in the best interests of ensuring that the judges remained in their current position. The changes that we have made will mean that the judiciary maintains its status quo. I believe that that is an appropriate way for the Lord Chancellor to have behaved.
Lord McIntosh of Haringey: My Lords, I am surprised that my noble friend did not correct the noble Lord, Lord Fowler, in his supplementary question. There is no limit on the provision that people can make for pensions; the only limit is on the amount on which you can get tax relief.
Lord Oakeshott of Seagrove Bay: My Lords, will the Minister tell us what capital sum would be needed to buy from a private sector provider the index-linked pension on which a High Court judge will now retire? I think that she will find that it is rather more than £1.5 million. If she does not have the figure to hand, will she please write to me with it?
Baroness Ashton of Upholland: My Lords, the noble Lord will be astonished to learn that I do not have the figure
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to hand, and of course I will write to him. The critical cost factor is the cost to the DCA, which I can confirm, as was laid out in the Statement, is £9 million per year.
Lord Borrie: My Lords, the reluctance of a number of senior lawyers, especially Queen's Counsel, to become High Court judges is often attributed to concern about a fall in income. To what extent is that true at present and to what extent are people who might become eminent judges if they were appointed also concerned about pensions?
Baroness Ashton of Upholland: My Lords, I have no doubt that those who are considering a judicial career think about pensions. The noble Lord will know that currently they cannot return to practice; therefore, it is important to take into account our need to have a good judiciary in this country and to make sure that they benefit appropriately.
Baroness Ashton of Upholland: My Lords, as far as I understand it, it does not. If that is not the case, I will of course write privately to the noble and learned Lord and ensure that his position is secure.
Lord Fowler: My Lords, of course the Minister and the noble Lord are right about tax reliefthere is no issue about that. But does she recognise that past changes have always been made openly and passed through Parliament in legislation? Does she not think, on reflection, that it was a pity that this profound and important change was made by means of a Written Answer, not even an oral Statement?
Baroness Ashton of Upholland: My Lords, it was made not by Written Answer but by a Written Ministerial Statement, a process that the noble Lord will know is appropriate in Parliament. We do not use primary legislation if we do not need it. Within the terms of the Finance Act and with regard to the way in which we were able to do this, primary legislation was not necessary. We have not attempted to be anything other than completely open; hence the Written Ministerial Statement.
The Parliamentary Under-Secretary of State, Department for Work and Pensions (Lord Hunt of Kings Heath): My Lords, research commissioned by my department's Age Partnership Group shows that
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aids and adjustments to the workplace can overcome problems associated with age and improve the functioning and productivity of all workers. I understand that the Department for Transport has also commissioned a study on the travel needs of people in later life, which will be available later in the year.
Baroness Gardner of Parkes: My Lords, I thank the Minister for that reply. Does he agree that it is important to give thought to this, as many people who had envisaged retiring at 60 will suddenly find themselves faced with a further five years of work? Even travelling to work on a train early in the morning can, for an older person, be difficult when carriages are extremely crowded and people have to stand. Should more be done to improve people's lot, not only in the workplace?
Lord Hunt of Kings Heath: My Lords, I assume that the noble Baroness is referring to the equalisation of state pension age for women occurring between 2010 and 2020. I take her point. The question of transport and the implication that older people may want to travel off-peak may encourage employers to think about more flexible working. My department would certainly encourage that. As for the general point, the more that we encourage older people to stay in work the better.
Baroness Greengross: My Lords, does the Minister not agree that employers, particularly from small and medium-sized enterprises, will need a lot of help and possibly incentives to encourage them to get this right? For example, employers should consider the ergonomics of the workplace, retraining and reskilling older workers and appraising workers throughout their career on the basis of their competence and capacity to do a job, not on the basis of their age.
Lord Hunt of Kings Heath: My Lords, I agree with all the points raised by the noble Baroness. I can report to the House that many companies are now developing very positive attitudes towards older workers. They are changing their policies, encouraging older workers and looking at aids and adaptations. I agree with the noble Baroness that we need to make sure that small and medium-sized enterprises are part of that as well.
Lord Howarth of Newport: My Lords, is it not the case that older people, like babies, are usually more robust than they appear? Your Lordships' House is testimony to that. What with demographic change and the difficulties that we are discovering in providing pensions, is it not the reality that people will have to work much longer, well beyond the age of 65, not in especially sheltered conditions but in the mainstream of the labour force, if they are to enjoy the living standards and the continuing good health that they want?
Lord Hunt of Kings Heath: My Lords, we have an aspiration for 1 million older people to stay in work
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over the next considerable number of years. As far as the state pension age is concerned, that was one of the recommendations made by the Turner commission, and the Government will be responding and outlining their policy on pensions later in the spring. As far as your Lordships' House is concerned, the definition in the DWP of an older worker is, I am afraid, anyone over 50. On that reckoning, I am afraid that all of us, apart from 38 Members of your Lordships' House, are classified as older workers. I think that we show very well the contribution that older workers can make.
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