Mineworkers’ Pension Scheme

Debate between Lord Hanson of Flint and Gloria De Piero

Thursday 14th February 2019 Commons Chamber

[Gloria De Piero]

My hon. Friend absolutely hits the nail on the head.

[David Hanson (Delyn) (Lab)]

Just to confirm what my hon. Friend the Member for Caerphilly (Wayne David) said, I served on the Labour side on the Bill that privatised the coal industry in 1994, and those guarantees were given at that stage.

[Gloria De Piero]

My right hon. Friend is absolutely right to make that point. What the headline figures that I have quoted do not tell us are the personal stories of hardship that our ex-miners and their widows are facing. The average weekly pension is not much more than £80 a week. It is hardly a sum that someone could live a luxury lifestyle on. MPS pensioners rightly feel aggrieved at seeing the profits from their pension investments being used to boost the Treasury’s coffers. An MPS pensioner from my constituency called into my office recently to show me his recent pension statement. He had received the news that, thanks to a 3.4% increase to his guaranteed pension and a 4.2% bonus, his pension was going up to the grand total of £74.71.

Town of Culture Award

Debate between Lord Hanson of Flint and Gloria De Piero

Wednesday 23rd January 2019 Westminster Hall

[David Hanson]

I look forward to hearing my hon. Friends’ contributions in due course. They know that culture is an economic generator for towns. It provides individuals with an opportunity to promote themselves and their skills, it can bring towns together to celebrate their history, and it can be a catalyst for change, confidence and support for economic regeneration.

[Gloria De Piero (Ashfield) (Lab)]

D. H. Lawrence, the internationally famous writer, was born and raised in the town of Eastwood in my constituency. We have a fantastic birthplace museum there. It is run by the local authority, which is obviously under financial pressure. We could do so much more to celebrate and promote our most famous son. Does my right hon. Friend agree that we could do a lot more to enable our towns to reach their full potential if there were equitable distribution of lottery funding?

[David Hanson]

Indeed. There is a separate debate, albeit relevant to this one, about whether towns, which contribute to the lottery pot, receive a fair share of lottery funding. In effect, there is a transfer of wealth from poorer towns to cities. That enables the promotion of important cultural projects, but I think my hon. Friends would agree that we should look at how we can invest that money to promote culture in our towns.

Civil Liability Bill [ Lords ] (Second sitting)

Debate between Lord Hanson of Flint and Gloria De Piero

Committee Debate: 2nd sitting: House of Commons
Tuesday 11th September 2018 Public Bill Committees

[Gloria De Piero]

Amendment 17 would require insurers to report on whether savings have been passed on to consumers. New clause 6 would require insurers to pass on all savings as a result of the changes to consumers. Unlike the Government’s over-wordy, over-complicated new clause 2, which I will discuss shortly, amendment 17 and new clause 6 are straightforward. They would require the Financial Conduct Authority to insist that insurers report on the savings they have made as a result of the Bill, and the extent to which such savings have been passed on to policy holders. There are no caveats, no get-outs—it is a straight-line requirement to do the right thing.

The Bill is the latest in a long line of Government handouts to the insurance industry. Back in 2012 in a closed-door meeting at No. 10, the insurers—in return for being able to set the fixed costs in the new fast track that the new Legal Aid, Sentencing and Punishment of Offenders Act 2012 introduced—promised to reduce insurance premiums. Since then, insurers have saved more than £11 billion; those are Association of British Insurers figures, not my own. As the Minister must concede, motor insurance premiums are higher now than they were then. So much for those promises.

In the Bill, the Government have, again, swallowed hook, line and sinker the insurers’ promises that they will reduce premiums. History is repeating itself. Insurers are making record profits: Direct Line’s profits in 2017 jumped by 52% to £570 million and Aviva recorded a profit of £1.6 billion. No, that is not all motor related, but in the case of Direct Line it will largely be so.

Meanwhile, insurer CEOs are on multimillion pound packages—Paul Geddes from Direct Line and Mark Wilson from Aviva made more than £4.3 million each in 2017. We are now discussing measures that will save the insurers £1.3 billion a year. Of that, the insurers might—if the wind is blowing in the right direction and none of the ludicrously large get-out clauses in new clause 2 apply—hand across up to 80%. Notably, the cuts to insurance premiums of £35 a year, which insurers are promising now, are much lower than the previous estimates of £50 per year promised in the Prisons and Courts Bill. The Government represent a party that claims to oppose red tape: here is a chance for them to avoid it. Let us have a simple clause that does what it says on the tin.

That leads me to Government new clause 2, which is as full of red tape as it is holes. Perhaps my most fundamental question to the Minister is this: what is wrong with the word “will”? The new clause is peppered with the word “may”. If the Government are genuinely committed to ensuring that savings are passed to consumers, why do they not insist that that happens? Paragraph 3 includes provision for all kinds of ways in which, by regulation, insurers should provide information. Is there any reason why that information should not be made publicly available?

Paragraph 4 is a catalogue of reasons why insurers could wheedle out of being transparent and evade passing on the very substantial savings that the Government’s impact assessment makes clear they will be making. The truth is that all the Government have managed to extract from the insurers, who stand to gain massively from this Bill, is a vague promise that they will pass on savings.

Embarrassed by the lack of hard evidence for a commitment, the Government have tabled this new clause, which is riddled with get-outs and opportunities for insurers to worm their way out of the flimsy commitments they have made. We know—and if the Government are honest, so do they—that insurers will seek to avoid paying the savings that they make back to policy holders. That is what happened when they last made promises in 2012. Given the weakness of the new clause, that is what will happen again.

In truth, the Government have rolled over and the new clause is simply a fig leaf to cover their embarrassment. The answer, I suggest, is to include a simple clause that—and I use a phrase from Conservative Back Benchers on Second Reading—will

“hold the insurance industry’s feet to the fire.”—[Official Report, 4 September 2018; Vol. 646, c. 111.]

Our new clause would mean that any savings made by any insurer as a result of anything in this Act, or associated regulation, will be passed to policy holders by way of reduced premiums. What could be simpler? The Minister may notice that our proposed new clause quite deliberately refers to

“savings made…as a result”

of changes by this regulation.

The Government have refused to include in the Bill the small claims changes that they propose; we will come back to that issue later in our other amendments. What is crucially different between the Government’s new clause 2 and our new clause 6 is that our new clause is not only simpler but mentions the savings that insurers will make from the small claims changes.

In calculating the £1.3 billion in savings that the insurers will make every year, the Government’s impact assessment includes the savings created by the increase in the small claims limit as a result of the so-called wider package of measures. For the Government not to include the savings made from the small claims limit changes in their new clause 2 renders it virtually worthless, and undermines their much-vaunted and fundamental promise that motor insurance premiums will drop by £35 a year.

[David Hanson (Delyn) (Lab)]

It is a pleasure to serve under your chairmanship today, Sir Henry.

I know it is a long time ago, but I will take the Committee back, if I may, to 25 November 2015, when George Osborne, as he is now known, was the Member for Tatton and serving as Chancellor of the Exchequer. At that time, he said—it was recorded in Hansard:

“We will bring forward reforms to the compensation culture around minor motor accident injuries, which will remove… £l billion from the cost of providing motor insurance.”

And here is the crucial bit:

“We expect the industry to pass on this saving, so that motorists see an average saving of £40 to £50 per year off their insurance bills.”—[Official Report, 25 November 2015; Vol. 602, c. 1367.]

When this Bill was introduced to the House of Lords and subsequently to this place, the Ministry of Justice’s impact assessment indicated at first that the figure would now be £40, not £50—not between £40 and £50, but £40. However, when the general election was fought last year, the figure had miraculously gone from £40 to £35.

In October last year, one of the insurance companies that the Minister in another place, Lord Keen of Elie, has been fond of quoting—Liverpool Victoria or LV=—spoke. Caroline Johnson, director of third party and technical claims at LV=, spoke at the Motor Accident Solicitors Society’s annual conference in Sheffield, which must have been an important place to say this; it was not just said off the cuff, but at the conference. She said, “The £35 may or may not be achievable”.

I ask my first question today in support of the new clause tabled by my hon. Friend the Member for Ashfield and to start the testing of the Minister’s new clause. In his response, can the Minister give the latest Government assessment of what the £50/£40/£35/possibly-not-achievable £35 is as of today? We are expected to take on trust the figures that he has given.

There is no doubt that the insurance companies will save £1.3 billion a year. That figure has been accepted by the Government and the insurance companies, and I suspect that it will be cited again—not only by my hon. Friend the Member for Ashfield, but by others who will say that it is the saving, the prize, that the Government seek. My concern is not the insurance companies and the £1.3 billion; my concern is how much, if there are savings to be made in the areas we are concerned about, of that £1.3 billion will land in the pockets of those individuals who would then have lower premiums as a result.

I am very pleased to sit on the Justice Committee, just as I was very pleased to sit coterminously this morning with this Committee; I have to say that was very interesting. The Justice Committee carried out an investigation into this area and came to a conclusion as a whole—it was not just the Labour members of that Committee. It is chaired by the hon. Member for Bromley and Chislehurst (Robert Neill), who is a Conservative; it has a Conservative majority; and it has unanimous support for the recommendations it made in this very area. The Committee said:

“As obtaining insurance involves a commercial transaction with a private sector body...there is little that the Government can do to enforce lower premium rates without significant change to present policies.”

My question to the Minister is about his proposed new clause 2. There is something I cannot find in it—it may be hidden in there within the legalese—but, if it is, could he please put it in simple language for the Committee? What happens if this investigation proves that the insurance companies have made a saving of anything between nothing and £1.3 billion? What steps will the Government take at that stage to enforce their policy objective of ensuring that £50/£40/£35/possibly £35 goes into the pockets of individuals who pay the insurance companies?