Postal Services Bill

Debate between Baroness Drake and Baroness Wilcox

Tuesday 24th May 2011 Lords Chamber

[Baroness Wilcox]

My Lords, Amendment 3 is designed to future-proof the information-sharing provisions in Clause 24 of Part 2. Clause 24 sets out a legal gateway to facilitate data sharing between the government scheme, the Royal Mail pension plan and the employer of the RMPP members. The framework will help to ensure that the administration of the two schemes is seamless so that, for example, members with rights in both schemes will need to notify a change in personal circumstances to only one point of contact rather than two. That is an important objective that we share with the trustees of the RMPP and, I believe, with all Members of the House.

The management of the ongoing Royal Mail pension plan will be a matter for the company and pension trustees. Amendment 3 simply ensures that if separate sections of the Royal Mail pension plan are split off into separate schemes at some point, the information-sharing framework provided under Clause 24 will extend to those separate schemes. That additional flexibility will help to ensure that we are in a position to meet our commitment to seamless administration, regardless of any changes that may be made to the RMPP by the trustees and company in future. I beg to move.

[Baroness Drake]

My Lords, government Amendment 3 to Clause 24 is in itself desirable. If the Royal Mail pension plan is to be divided into two or more pension schemes, as distinct from sections, it is better that all trustees co-operate with efficient administration and have the power so to do. What is most interesting about the amendment, however, is that it reveals for the first time during the Bill’s progress that the Government's intention may be to split the Royal Mail pension plan into two or more separate schemes, as distinct from sections.

It would be possible not to split the scheme and run the Royal Mail pension plan as a segregated scheme similar to the railway pension scheme. From the perspective of scheme members, that may well be a preferable outcome, because the governance structures would remain in place, but one can anticipate that that may not be the Government's preferred outcome. As the amendment now introduces separate schemes into the Bill, as distinct from separate sections, it raises questions that I put to the noble Baroness.

Is it now the Government’s decided intention to split the Royal Mail pension plan into separate schemes post-privatisation? If the Royal Mail pension plan is to be so divided, is the Post Office scheme to be hived off, leaving the reduced Royal Mail pension plan with the privatised Royal Mail, or vice versa? What is the Government's intention on consulting the trustees on such separation?

A fourth point that I know will be of concern to scheme members attracted some attention in the debate in the House of Commons. There is no power to wind up in the rules of the Royal Mail pension plan. That is a very important safeguard for the current members, which ought to be replicated.

During the House of Commons Committee debate on 30 November 2010 the Parliamentary Under-Secretary of State for Business, Innovation and Skills, Mr Edward Davey, commented to the effect that inserting a winding-up provision would be prevented by the then Clause 19 of the Bill, which is now Clause 20, dealing with the “no worsening of benefits” provision. He said—