Social Security (Up-rating of Benefits) Bill

Debate between Baroness Bennett of Manor Castle and Baroness Sherlock

Committee stage
Tuesday 26th October 2021 Lords Chamber

[Baroness Bennett of Manor Castle (GP)]

My Lords, it is a pleasure to follow the noble Lords, Lord Sikka and Lord Davies of Brixton. Given the hour, I will be brief. I very much endorse the comments of the noble Lord, Lord Davies, about this Clause 1 stand part debate seeking to ask the other place to think again, and indeed to ask your Lordships’ House to debate this.

I would be more radical than either noble Lord who preceded me. I believe that the state pension should be set at a level where no pensioner is living in poverty—that is looking at the relative poverty levels, as outlined and widely discussed by the noble Baroness, Lady Lister. That would mean abolishing the contributory principle. Our debate tonight has demonstrated how discriminatory and actively massively unfair that is—because, as worked through now, it largely acknowledges only contributions through paid work. We know that many people, particularly women, make huge contributions to our entire society and future through care, community work and other activities which are simply not recognised in our pension system. This is leaving huge numbers, particularly of women, in a state of living that our whole society should regard as not acceptable.

I agree again with the noble Lord, Lord Davies, that the triple lock is far from perfect. We have talked about heating costs. Of course, another way in which we have very much failed our pensioners is the quality of the housing stock that they are living in. Reference has been made to the quality of council housing, but we also have a huge problem with more and more pensioners now living in private housing due to the huge privatisation of our housing stock through right to buy. Those people are living in extremely poor conditions and are placed in very difficult circumstances in that housing.

I agree with the noble Lord, Lord Sikka, that the cost of not going forward with ending the triple lock for this year—£4.7 billion—is very modest in the overall scheme of things. We have bailed out the banks. When Covid-19 hit, we bailed out many businesses. Surely we should look to bail out our pensioners.

I finish by noting that, when we talk about £14 a week, I agree with the noble Lord, Lord Sikka. There is a relatively small number of people in our society for whom £14 a week is small change, but there are very large numbers of people and pensioners for whom it is literally a matter of life and death. I invite noble Lords to consider our excess winter deaths, many of which occur among pensioners.

[Baroness Sherlock (Lab)]

I will be very brief. I thank my noble friend Lord Sikka for introducing this debate. We all share an underlying concern about the living conditions for poorer pensioners. I will not dwell on pensioner poverty; I made a perfectly long—arguably overlong—speech on the last group of amendments about this very subject.

Because the Bill has only two clauses and Clause 2 is the commencement clause, I suspect that, in coming back, the Minister will be tempted to focus on the fact that this may be regarded as a wrecking amendment because it would remove the entire contents of the Bill. We on this side accept that there is a difficulty in looking at and using the data for the earnings measure without adjustment, so that is not the position that we are in. I encourage her, when she responds, to answer and speak to the underlying concerns about pensioner poverty that have been expressed noble Lords, and perhaps give some assurance to the House about how the Government will tackle that, as well as looking at the immediate issue.

Skills and Post-16 Education Bill [HL]

Debate between Baroness Bennett of Manor Castle and Baroness Sherlock

Report stage
Thursday 21st October 2021 Lords Chamber

[Baroness Bennett of Manor Castle (GP)]

My Lords, I slightly unexpectedly find myself to be the first person to speak to Amendment 40 in the name of the noble Lord, Lord Watson of Invergowrie, also signed by the noble Lord, Lord Storey, and me. Amendment 45A calls for a review to look at the issues around a restriction on allowing people to study at a level below that which they already possess. Amendment 40 goes further in removing restrictions.

I would have thought that naturally the Conservative position would be a belief that the person best placed to decide their best course of study would be the individual concerned rather than the state. This is a question of individual choice, about people knowing best their own situation. Therefore, while I very much support Amendment 45A, which at least calls for a review, I would go back to the more fundamental change in Amendment 40.

I am also in favour of Amendment 36 in the name of the noble Lord, Lord Storey. Education is a public good. We hear a lot of talk about investment for levelling up. Well, investment in people is the most fundamental investment of all. It is flexible, it enables people to make choices for themselves. A new or improved railway line or better school facilities are there and accessible to people, but people making their own choices is what investment in education is all about.

I am also in favour of Amendment 48, not yet addressed by the noble Baroness, Lady Sherlock. I will leave her to fully explain this, but it is worth stressing that what does not get measured and focused on does not get funded or supported. That is the principle behind that amendment.

[Baroness Sherlock (Lab)]

My Lords, as this is my first speech on Report, I welcome the noble Baroness, Lady Barran, to her new ministerial role, and place on record my thanks to the noble Baroness, Lady Berridge, for her hard work on the Bill and her openness and willingness to engage with those of us on this side.

I speak specifically to the government amendments in this group. My noble friend Lady Wilcox will talk about the others in this group. We would have preferred them to be de-grouped, but time is short. However, the Government were planning to bring back for Report detailed amendments on the lifelong loan entitlement. Since they have now decided not to do that, we are left with several questions which I must ask. I apologise for doing so on Report, but we have not had an opportunity to do so otherwise.

In Committee, the Government tabled some amendments which were presented as providing some of the wiring in the basement of higher education that would be needed when Ministers unveiled their renovation plans in the form of the LLE. However, since those plans must wait until another day and, we are told, until more primary legislation, because Ministers want to wait for the consultation first, we are left with some big questions. One obvious question is: when will the consultation happen? Indeed, why is it not already out there? What is holding it up?

Ministers have brought back some parts of the wiring amendments on Report. The LLE is meant to cover courses and modules in FE and HE. Clause 14 amends the Teaching and Higher Education Act to allow for the funding of courses in FE and modules in FE and HE, a lifetime funding limit and for funding not just for an academic year. Clause 15 amends HERA to change the definition of a “higher education course” to make it clear that the regulatory regime applies to modules. Government Amendment 39 defines what a course and a module are. However, at the risk of being nerdy, I point out that the Government have not brought back the parts of an amendment that they tabled in Committee which required the Office for Students to specify fee limits for modules as well as courses. We are told offline that the Government will provide for modular fee limits after the consultation. Will that require primary legislation? Does any other aspect of the LLE require primary legislation? If so, can we have a timescale for it? If not, can the Minister say how and when Parliament will have a full debate on the shape and scope of the LLE absent primary legislation?

Where does that leave us in the gap between the Bill taking effect and the new regime being brought forward? If THEA will now permit student loan funding to cover modules which are not taken as part of a full course, does that mean that a provider could do that now but with no fee limits, or would that require regulations to be made, perhaps under THEA? If so, can the Minister assure the House that no such regulations will be brought forward ahead of the debate on the primary legislation promised to enable LLE?

I have three other questions. First, does the same definition of a module in the Bill, as it will be amended, apply for all purposes—funding and regulation—in both HERA and THEA? I ask because Clause 15 as amended by government Amendment 39 offers a definition of a module, which I mentioned in Committee. However, new subsection (1)(e) in Clause 14(1) provides that regulations under Section 28A of HERA may prescribe the meaning of “module” in relation to HE or FE. Can the Minister clarify that distinction? Secondly, on funding, irrespective of how LLE develops, does it mean that a module can be funded via the student loan book only if it is part of a full course? In other words, would the Bill as amended exclude a module which was not part of a qualification?

--- Later in debate ---

[Baroness Bennett of Manor Castle (GP)]

My Lords, I rise with great pleasure to offer my support to Amendment 45 in the name of the right reverend Prelate the Bishop of Durham, to which I have attached my name. It is, in a way, the reverse of Amendment 63: Amendment 45 says that adult learners should be able to get universal credit; Amendment 63 says that you should be able to become an adult learner while on universal credit. I am not sure which is the best way round, but I am not sure that it matters or will make much practical difference. Both the right reverend Prelate and the noble Lord, Lord Storey, have clearly outlined the Kafkaesque complications that arise, and the unreasonable unintended traps people can find themselves in when they seek to study and find that the system simply does not allow them to.

I want to come from the other point of view very briefly and think about the overall good of the country. As I was contemplating these amendments, I thought back to hearing an economist talk about how, slightly counterintuitively, having a very short period between people becoming unemployed and finding a new job might not be the best thing, because if you have very low levels of unemployment benefits, as we do in the UK compared to many continental countries, people have to grab the first job they can secure—the first job that comes along. That means that you get an awful lot of square pegs in round holes. You get people who are not best for the job. They are not good for the employer and it is not good for them to be in a job for which they are not suited. If you have a longer period, people are able to assess and improve their skills and then find the right job, stay in that job for longer, advance in it and make real progress. We need to move towards a system that allows that to happen. When we talk about the economy, we talk about how we can solve our productivity problem. These are the base issues that we need to think about. Amendments 45 and 63 address them.

On Amendment 62, I want to offer the Green group’s support. The noble Lord, Lord Aberdare, said nearly everything I was going to say, so I am not going repeat it. It was reminiscent of some of the reports you hear of the green homes grant and employers struggling to get paid. If we are talking about small employers, their cash flow can become a serious problem.

I note one figure that says that the north-east—the region with the highest unemployment in England—is the area with the lowest rate of take up of Kickstart. That is obviously a concern, and it should be looked at in a review, particularly in the light of the Government’s levelling-up agenda.

[Baroness Sherlock (Lab)]

My Lords, I am grateful to the right reverend Prelate the Bishop of Durham and all noble Lords who have spoken. In Committee, we had a good debate about universal credit and the various ways in which people are discouraged by the rules from getting the skills that they need. I think the issue is that government policy is not properly joined up. We need to have skills, employment and social security policy fully aligned to make this work.

What is going wrong? I suspect that, at heart, it is an issue of departmental responsibility. DfE basically wants people to get training to increase their skills so that they can engage in productive, sustainable work, but most people cannot afford to train or retrain without financial support. I suspect DfE would quite like them to be able to get benefits while they do it. However, DWP does not think its benefit system is there to support students in education and training; it thinks that is DfE’s job. In general, that works. Most students are supported by loans or grants, and a lot of people on universal credit want to get back into work and universal credit supports them while they do. But there are clearly people who may struggle to get back into sustainable jobs unless they increase, update or change their skills, and it is likely that there will be more of them in the future than there have been in the past.

In Committee, the right reverend Prelate the Bishop of Durham and other noble Lords identified a number of barriers that get in the way of people wanting to do that. The Minister’s defence was basically twofold. She said, first, that DfE and DWP are working together on it and there is a trial under way for six months. She said that there is flexibility on conditionality, so that if you get universal credit and are part of the intensive work search scheme, you can study full time for 12 weeks, with boot camps and so on—the lot.

Secondly, she said that the benefit system may not be there for education and training for most people, but some people can get help. The Minister mentioned Regulation 14 of the Universal Credit Regulations 2013. I went back and refreshed my memory of that regulation. It lists the exceptions, but the only exceptions are young people doing A-levels or the like who are not living with their parents, those who have kids and some disabled people with limited capacity for work. As I read on—the Minister can correct me—I thought that all Regulation 14 does is remove the blanket requirement that you must not be in education to qualify for universal credit at all. I do not think it stops people—even in those groups—having conditionality requirements placed on them in the way that the right reverend Prelate the Bishop of Durham described, which might make it impossible for them to take on a training course. Can the Minister clarify that?

It is really quite hard to work out who can get universal credit for training, at what level and where. To that end, can the Minister tell the House whether any or all people wishing to carry out study necessary for a course leading to the lifetime skills guarantee could get universal credit while they do it, as Amendment 63 suggests? If not, how should they support themselves while they do that?

Amendment 45 from the right reverend Prelate the Bishop of Durham makes a broader point about the needs of people who are unemployed and need training to get secure, sustainable employment. There is a balance here. The benefits system is not there to fund everybody wanting to retrain, but this amendment could pick up some of those people who are long-term unemployed or may have gone from one low-paid, insecure job to another, perhaps with periods on benefits in between. Might not they and the taxpayer be better served if they could afford to get trained for a secure and sustainable career? How could they be helped under the Government’s current approach?

I turn now to Amendment 62, which would require the Government to reconsider how long Kickstart runs and who is eligible for it. When we debated Kickstart in Committee on 19 July, the Minister, the noble Baroness, Lady Penn, said:

“I cannot say that we will extend the duration of the Kickstart scheme or change its eligibility”.—[Official Report, 19/7/21; col. 103.]

A summer is a long time in politics because, as we have heard, a Written Ministerial Statement has now announced that Kickstart is running until the end of March. Who knows? By the time we get to Third Reading, maybe eligibility will have been reviewed as well—you never know.

I have a sneaking suspicion that the decision to extend the timescale was driven less by the rhetorical powers of noble Lords—marvellous though those are—and rather more by the fact that Kickstart is nowhere near hitting its targets. There were meant to be 250,000 placements by December. The latest figures I could find were in a Written Answer to my noble friend Lady Wilcox on 21 September in which the noble Baroness, Lady Stedman-Scott, said that 69,000 young people had started Kickstart jobs as of 8 September. Does the Minister have more recent figures? That Answer also said that more than 281,000 jobs had been approved. If 281,000 jobs have been approved and only 69,000 people have started work, that is worse.

The regional position, raised by the noble Baroness, Lady Bennett, is really significant. I have raised the positions of the north and north-east before—not just because I live in Durham—but that Written Answer said that in the whole north-east of England only 3,170 people had started Kickstart jobs. Something is going wrong.

Can the Minister tell the House what the Government are doing to rescue this scheme? In particular, why is there this lag between jobs created and jobs filled? What is happening to get young people into these jobs? Do the Government expect to meet their 250,000 target by December, March or another date? I look forward to the Minister’s reply.

Skills and Post-16 Education Bill [HL]

Debate between Baroness Bennett of Manor Castle and Baroness Sherlock

Committee stage
Wednesday 21st July 2021 Lords Chamber

[Baroness Bennett of Manor Castle (GP) [V]]

My Lords, I must first apologise for my absence from this Committee on Monday, particularly to the noble Baroness, Lady Sherlock, and the noble Lord, Lord Watson of Invergowrie, whose amendments I had signed. It was entirely due to an administrative foul-up on my part.

I speak today in support of the amendment in the name of the noble Lord, Lord Willetts, which in some ways reflects what is happening now in an ad hoc way. Back in 2018, Philip Augar was asked to review what was happening with student fees. In January, we had an interim response from the Government on that, but, according to the Guardian at the start of this month, we are going to get the Government’s full response soon—we are looking at a four or five-year time period, the same as is proposed in this amendment.

What we are hearing about the debate going on behind the scenes before we get that response is talk of tuition fee cuts, a cap on student numbers for certain courses and minimum qualifications, which are all designed to lower the cost to the Government of financing the student loan system. The fact is that, when tuition fees were set at £9,000 in 2012, the intention was to have inflationary increases at regular intervals. But since being raised to £9,250 in 2016, the fees have remained at that level while the real value has declined by 12%. It is notable in this context, as the noble Lord, Lord Willetts, said, that this is an intensely political issue and decisions are very likely to be made in an ad hoc, highly political way.

It is interesting that apparently the report suggests that the Treasury is seeking to directly cut fees and increase repayments, while other parts of government favour more indirect means, such as minimum entry requirements and course caps. We really have to think about that latter approach in the context of the Bill we are debating now; it is focused on the need for more skills and education, yet we are expecting sometime soon a proposal from the Government that will squeeze down and reduce people’s access.

We have to look at where we are: more than £17 billion is being loaned to students each year. The value of outstanding loans has reached £160 billion, and this is expected to be £560 billion by the middle of this century, at 2020 prices. Some 75% of students will not repay their loans. That means half the people in a single generation going through life for 30 years with that weight resting on their shoulders. We are in a situation now where we are stressing the need for this review. Think about Covid; it descended on us and society changed enormously, and in this age of shocks, we do not know what changes will arrive in future.

The noble Lord, Lord Willetts, reflected that the Government would probably not welcome this amendment, because the issue of fees is so difficult and controversial. However, I agree with the noble Lord that this magnifies the need for a systematic, planned, guaranteed measure of review. We could even argue that it would make it easier for Ministers, because by being on the face of the Bill, it would be a review that had to happen, and it would be set in the government timetable.

The practical reality is that what we have now is a fantasy. These are called loans, but most of the money will never be paid back. We as a society need to reflect on the fact that education is a public good, and it should be paid for from general progressive taxation, not weighted on to the shoulders of individuals, in a system whereby those who earn the most can, by paying off their loans fast, repay the least. We need change. The amendment will not achieve that, but it would at least create a pause, a chance to think—indeed, a requirement to think—about what we are doing to our young people and their future.

[Baroness Sherlock (Lab) [V]]

My Lords, I thank the noble Lord, Lord Willetts, for introducing his amendment, and the noble Baroness, Lady Bennett, for her reflections—and for her courteous but quite unnecessary apology. The current arrangements for student loans are now quite complicated. A recent House of Commons Library brief gave a lovely timeline of all the changes from 1990, when the first loans were introduced for student support—then at just £420 a year. It then tracked the developments, as loans gradually replaced grants for maintenance, and there was a shift from mortgage-style loans to income-contingent repayment schemes. Then loans for fees started, and some maintenance grants came back.

The big shift came in 2012, when fees trebled and the current system was in put in place. The effect of this pattern showed up when I was chatting recently to a member of our small opposition staff team. She had compared notes with a couple of colleagues in the office, and realised that although the three of them had graduated not so many years apart, each had a different package of debt and repayments.

Part of the reason for the complexity is that the system has so many moving parts. A Government wanting to save money have a range of ways to do it. They can change the size of the original debt, as they did dramatically in 2012. They can change the repayment threshold, as they did in 2016, when they decided to stop tracking earnings and freeze the threshold until 2021—although that went down so badly that they changed it again, not just unfreezing the threshold but raising it to £25,000 from 2018. They can change the contribution period; indeed, Augar recommends raising it to 40 years. They can change the contribution rate. That is still 9% for undergraduate degrees, but loans for master’s programmes were introduced in 2016, and for PhDs in 2018. That rate could now go up to 15% of earnings above the threshold for postgrads. Or they could change the interest rates. Indeed, they are spoilt for choice here: they could change the rate while studying or the rate when repaying, or they could change one or both of the lower and upper thresholds. Each of those changes or combinations would have a different distributional effect.

I take it from his introduction that the noble Lord, Lord Willetts, wants a periodic systematic review, and he made his case for that. But does his amendment mean that changes could be made only then? I suspect that the answer to that might affect the Government’s interest in the idea.

One benefit of the systematic approach would be the opportunity to ensure that factual information about the impact of changes to the system was gathered and disseminated. Does the Minister agree that work is needed to ensure that the student loans system is widely understood? After all, if Governments are to make changes to student finance, it is vital that it is not done by sleight of hand, or by banking on the HE version of a fiscal drag. It is crucial that the differential impact on people with different likely lifetime earnings is made crystal clear. After all, if the state is advancing £17 billion a year to higher education students in England and the value of outstanding loans is some £160 billion this year, the least the Government owe the country is transparency, and a good public debate. Does the Minister agree?

--- Later in debate ---

[Baroness Bennett of Manor Castle (GP) [V]]

My Lords, it is a great pleasure to follow the noble Baroness, Lady Greengross. This group of amendments has already been outlined clearly by the right reverend Prelate the Bishop of Durham. To sum up his contribution, he asked how people could better use their time while unemployed than by upskilling. The noble Lord, Lord Addington, said that it would be an absurdity not to encourage the unemployed to improve their skills.

On day one of our debates, we talked a great deal about the need, in our climate emergency and nature crisis, to increase our skills. There is simply so much that we need. People who are unemployed are obviously at a potential point where we can start to fill some of those gaps.

The noble Baroness, Lady Janke, made an important point: that unemployed people are of all ages, from those just leaving school to those in their 70s and beyond who still need, or want, to work. They often have commitments, for example to children, to rent, to a mortgage or to supporting older relatives. We cannot assume that they are just a unit of labour that can be shifted around at will.

What we have seen is decades of wretched economic change in many parts of the country, which has only been amplified by Covid. It is worth looking at a study from the Institute for Employment Studies, published in June. It attempts to explain the current conundrum where we have a recruitment crisis yet in parts of the country there are as many as 10 jobseekers for each vacancy. According to the study, the average number of people across the country claiming unemployment benefit and competing for each vacancy is 2.2, and almost 100 local authorities have five jobseekers going for each available role.

People have to be able to make choices in their own interests and in the interests of the country. Leaving people trapped, applying—pointlessly, they know—for scores and scores of jobs that they know they are not going to get is profoundly dispiriting and damaging. We need to give people the option of finding another path forward in life instead of being trapped in that situation.

[Baroness Sherlock (Lab) [V]]

My Lords, I am grateful to all noble Lords who have spoken to air these important issues.

The right reverend Prelate the Bishop of Durham identified some of the major barriers placed in the way of people who want to take up education and training to improve their skills. Did the Minister see the recent report from the Association of Colleges? It concluded that the current social security rules

“actively discourage people from getting the skills they need”—

a point reinforced by the noble Baroness, Lady Greengross. The report argues that, if this is not fixed, it will result in

“fewer people in stable and meaningful jobs … slower economic growth … reduced opportunity to meet employers’ skills needs; and … bigger tax burdens.”

It is crucial that government policy is joined up, with skills, employment and social security policy properly aligned. Indeed, as the noble Baroness, Lady Bennett, pointed out, all these must be aligned with our overriding plans to deal with the climate emergency. Amendment 98 in my name is designed to probe whether the Government have any plans to do this, in terms of alignment, by changing the rules on universal credit to support skills development.

Most people who are studying full-time cannot get universal credit. There are exceptions, such as for young people who are doing A-levels or other non-advanced courses and do not have parental support, for those who are responsible for children and for some disabled people with a limited capacity for work. Otherwise, people on UC face the kind of conditionality requirements mentioned by the right reverend Prelate, the noble Baroness, Lady Janke, and others. Specifically, unless they have an easement of some kind, UC claimants are meant to spend 35 hours a week looking for work, and to provide evidence. This can result in some pretty dispiriting things of the kind mentioned by the noble Baroness, Lady Bennett. The claimants are allowed to do part-time education or training, but only if they can fit it in in their spare time—in other words, fit it in around a full week’s job search.

Pension Schemes Bill [HL]

Debate between Baroness Bennett of Manor Castle and Baroness Sherlock

Committee stage & Committee: 1st sitting & Committee: 1st sitting : House of Lords
Monday 24th February 2020 Grand Committee

[Baroness Bennett of Manor Castle (GP)]

I ask your Lordships to note that this is the first time I have tabled an amendment in Committee, so please forgive any infelicities in my procedural approach. I would appreciate any nudges in the right direction, should I need any. In speaking to this and other amendments bearing my name, I note the assistance and initiative of the campaign group ShareAction, which has helped with what I am about to say and the amendments.

The noble Baroness, Lady Altmann, said earlier that in setting up CDCs we are starting with a blank slate. We are starting in the modern era. This is the chance to do things right. Many of your Lordships are aware of the numerous studies showing that more diverse groups of decision-makers make better decisions. If the trustee boards of the CDCs reflect the diversity of the wider groups of people they represent, their collective life experiences will improve their capacity to understand the unique challenges faced by different pension scheme members. Pension outcomes are affected by issues such as gender, ethnicity and, as we referred to in an earlier amendment, generational equity. I am sure there is a great deal of expertise on pensions in this Room. Many noble Lords will know that the gender pension gap is currently 40%—twice the gender pay gap.

I warn your Lordships that this amendment is very modest compared with many that I may put before the House. It is not calling for mandatory diversity rules. If we were talking about the composition of major company boards, I have long been a campaigner for mandatory rules on gender diversity on those. These are measures aimed to ensure that CDC trustee boards are fit for the modern era and that they have at least considered these issues of diversity that we know are so crucial to good decision-making. These are a new type of pension scheme. Let us make sure they are fit for this century. I beg to move.

[Baroness Sherlock]

My Lords, I thank the noble Baroness, Lady Bennett of Manor Castle, for raising this issue and for starting so gently with us—we look forward to seeing where she will take us in future. We do not get much excitement on pensions Bills, so we are looking forward to her giving us some.

I am glad that the noble Baroness raised diversity, because it is something that we are certainly concerned about, as most people interested in pensions should be. She is not alone in raising these concerns; the Pensions Regulator raised them, too. It published a consultation document last year on the future of trusteeship and governance, in which it made a strong case for the need to improve diversity in pension boards. It made many of the points that the noble Baroness raised about the size of the gender pensions gap, but it also flagged up the gap that those who are disabled or from a black, Asian and minority ethnic background have poorer pension outcomes than other workers.

A lack of diversity on pension scheme boards has long been acknowledged as a problem. The 2016 PLSA annual survey found that, on average, schemes had more than 83% male trustees, with one-quarter of trustee boards being all-male. We are not talking about these things not being entirely balanced. If in this day and age a quarter of trustee boards are all-male, something needs addressing.

The idea behind the noble Baroness’s Amendment 12 is that schemes should report on the action that they are taking to address diversity. It does not even mandate an outcome; it asks simply, “What are you doing about it?” In fact, TPR put that option in its consultation document. It said in response to the consultation that opinion was divided, pretty much down the middle, with half the people thinking that this was a good idea and the other half thinking that it was a bad idea. Therefore, it decided not to do it.

Obviously, I could make an alternative argument based on those same facts, but I just want to ask the Minister: if not this, then what and when? The back-up position from TPR was that it was going to have an industry working group to look at improving the diversity of scheme boards. Will that go ahead? If so, has it launched or when will it launch? Crucially, how will we know whether it works? What would success look like? If we are not going to ask people even to report on the actions they are taking, we would want to know that the alternative will make a difference. If TPR and the noble Baroness, Lady Bennett, are of one mind in saying not only that the lack of diversity is a problem but that more diverse boards make better decisions—and they are making decisions about diverse scheme membership—this is an issue on which the Government have to take some kind of action. So if not this, then what?

[Baroness Stedman-Scott]

My Lords, the two amendments tabled by the noble Baroness, Lady Bennett, to Clauses 46 and 119, both relate to issues of diversity and protected characteristics.

I will speak first to Amendment 12. I note that the aim of Clause 46, which contains requirements relating to the publication of information concerning CDC schemes, is to drive transparency about how they operate. The noble Baroness’s amendment would require CDC schemes to provide diversity information to the Pensions Regulator on what actions the scheme has taken to ensure diversity with regard to age, gender and ethnicity in its trustee recruitment. As we heard from the contributions, particularly that of the noble Baroness, Lady Sherlock, there is work to be done on this.

We recognise the importance of diversity in trustee boards, not just for CDC schemes, but across all trust-based schemes. Indeed, the Pensions Regulator has recently published its response on the future of trusteeship consultation, which considered specifically whether there should be a requirement for pension schemes to report to the regulator what actions they are taking to ensure diversity on their board of trustees.

The response to the consultation advised that there was a lack of consensus on this issue, as has been referred to, with some respondents in favour of it and others suggesting that there were initiatives already in place or that such a reporting regime would place an unnecessary additional burden on schemes. The noble Baroness, Lady Sherlock, asked, “If not this, then what?” I can tell her only that the regulator concluded that

“it would be beneficial to create an industry working group”

to further investigate raising the profile of this important issue, with a view to developing additional guidance and supporting material to help improve the diversity of trustee boards. So, I think that will happen. As I am sure noble Lords will appreciate, I would not want to pre-empt this significant work, but we will keep it under review and consider it further as it progresses.

The Government’s focus on the trustee landscape, including for CDCs, is to ensure that trustees meet standards of honesty, integrity and knowledge appropriate to their role. I think that employers and members participating in these schemes would reasonably expect that to be the case.

Together with Clause 9, Clause 11 means that the Pensions Regulator must be satisfied that the persons involved in the CDC scheme are fit and proper persons to act in relation to it. If the regulator is not satisfied, authorisation of a CDC scheme cannot be granted. We recognise that if we want to engender confidence in CDC, and ensure that the interests of members are protected, it is vital that the schemes be managed by appropriate individuals.

On Amendment 15, relating to pensions dashboards, again the Government recognise the importance of diversity on trustee boards. However, we have had to consider what information to prioritise as being required from day one. As we set out in the Government’s response to the consultation on pensions dashboards, the intention is to start with the provision of basic pensions information. This initial information is intended to help consumers plan for their retirement, in line with our primary policy objectives.

The success of dashboards is predicated on there being a good level of coverage across pension schemes. Achieving good coverage is a complex task. There are over 40,000 pension schemes, with data varying in quality and stored to different standards. The Government expect that it will take three to four years for there to be adequate coverage, with pension schemes initially providing simple levels of information. Increasing the amount and complexity of information required from pension schemes in the early stages may significantly delay delivery. The development of dashboards will be iterative, and we will continue to consider what information is placed on them following their initial delivery to the public.

TPR has not launched the working group yet, and its timescale is not confirmed, but we will monitor the situation. For the reasons that I have given, I hope that the noble Baroness will withdraw her amendment, but I am sure that she will never let up on her campaign.