Pensions Bill

Debate between Lord Faulkner of Worcester and Lord Freud

Monday 13th January 2014 Grand Committee

[Lord Freud]

I am, of course, always very grateful for warnings from the noble Baroness or other members of the Committee. That is clearly one of the areas in which quite a lot of detailed work needs to be done. I suspect that it is a minority sport that she is defining, but nevertheless we will need to look at it.

On the question of the noble Lord, Lord McKenzie, about what pension entitlement is necessary, people can have a pension entitlement that consists of graduated retirement benefit or state pension based on their own record of national insurance, which is a category A pension, or one derived from a spouse or civil partner’s record, which is a category B pension. Proposed new Section 61ZA overrides the rules that prevent people having an entitlement to more than one pension at a time.

On the question about what we call it, I think that the noble Lord called it a savings vehicle. We have to be rather careful in our language, which the noble Lord was good enough to recognise and acknowledge. Class 3A will be a one-off opportunity for today’s pensioners, with a cap on the amount of additional pension that can be bought and a limited window during which applications can be taken. As with other forms of voluntary national insurance, we do not expect it to be seen as an investment in a commercial sense. As class 3A is not an investment product, it does not require regulation by the Financial Conduct Authority and, therefore, people with defined contribution pension savings will not be able to get their pension pot refunded in order to take up class 3A as an alternative to an annuity.

On the point raised by the noble Lord, Lord Browne, about the belt and braces approach of the Government Actuary or the Deputy Government Actuary, this is a provision to cover situations where the post of the Government Actuary is vacant. It enables engagement for consideration. I know the noble Lord takes an Occam’s razor attitude to legislation, but that is the reason.

The question from the noble Lord, Lord McKenzie, on the recovery—

[The Deputy Chairman of Committees]

I apologise to the Minister—he will have to finish in a few minutes. A Division has been called. The Committee will stand adjourned for 10 minutes.

Energy: Winter Fuel Payment

Debate between Lord Faulkner of Worcester and Lord Freud

Monday 19th December 2011 Lords Chamber

[Lord Freud]

Yes, my Lords, like the other 81 per cent in the Chamber I have to declare an interest in this matter, although I shall keep my tax arrangements between me and HMRC. One of the issues around taxation is that it is not straightforward to tax the winter fuel payment as it stands because it is a household payment whereas tax is done on an individual basis. It could be done but it is rather complicated.

[Lord Faulkner of Worcester]

Can the Minister confirm that there is nothing whatever to stop the noble Lord, Lord Oakeshott, giving away the money if he does not want it?

[Lord Freud]

My Lords, as the noble Lord knows, all money is fungible. This is a matter of psychology rather than funding. If people find it convenient to look at money as being in separate packets and give money in a particular packet to a particular charity, that is a very excellent thing to happen, particularly if it encourages charitable giving more generally.