Pensions Bill

Debate between Lord Whitty and Lord Browne of Ladyton

Wednesday 8th January 2014 Grand Committee

[Lord Whitty (Lab)]

My Lords, I fully support what my noble friend has just said and have some amendments in this group which point in the same direction. The issue is fairness in relation to expectations. Under this part of the schedule, if your entitlement under the prior system is greater than the reference point, it is index-linked on a different basis from that on which it would be if it falls below the reference point.

The Minister may regard that as part of the overall approach, but in terms of the expectations of the people concerned there is in essence the same point as was in my noble friend’s previous amendment: somebody who is retiring in 15 years’ time may be able to provide other means of savings to make up for the loss of expectation. However, if they are retiring fairly close to the due date of the single tier, then their expectations cannot be made up in that time. A significant degree of unfairness applies there. The same applies in relation to the subject matter of these amendments if you happen to be one side or another, under the old system, of the proposed reference figure of £144 or whatever it turns out to be. There is no particular reason why one group of workers—who have, by and large, not had the most favourable pension schemes but have saved into the state second pension—should be treated differentially in this way, compared with their expectation.

It is an issue of fairness. The triple lock seems to have all-round support except in these clauses. It seems that the Government, at a relatively small cost, could make the adjustment here and save quite a lot of aggro and, I suspect, a significant postbag for most Members of Parliament.

[Lord Browne of Ladyton]

My Lords, I have no idea how many persons Clause 6 is expected to relate to, but it seems to be a discrete and relatively small group of pensioners. As I understand it, it deals with those who, after the start date, leave a contracted-out pension scheme where, under the rules of the scheme, they are not entitled to a pension and their transitional rate will be calculated as if they have never been contracted out before, and thereafter by reference to Schedule 1 which will set out the rules whereby that transitional rate will be calculated.

Amendments 25 to 29, as my noble friends have explained, all have similar intentions behind them. They refer particularly to the revaluation of the foundation amount and the protected accrued state pension amount above the single-tier amount for people with pre-commencement qualifying years of practicable pensionable age. As my noble friends have explained, the amendments are designed to ensure that for the revaluation of the foundation amount and the amount in excess of the full single-tier state pension, the protected payment would be in line with average annual increases in earnings as opposed to annual increases in general price levels. I hope that I have understood the effect of these complicated amendments. Currently, the Bill specifies that the valuation of the foundation amount up to the full rate of the state pension is to be revalued by earnings and any excess over that rate is to be revalued in line with the annual increase in the general level of prices.

For all those reasons articulated by my noble friends, which it would be otiose to repeat, I look forward to the Minister’s assessment of my noble friend’s amendment. I ask him to address these additional questions when he responds to the amendment. How will the public be informed of these changes to their pension entitlement in order to ensure that they are able to make adequate preparation for a secure retirement? In the words of my noble friends Lady Turner and Lord Whitty, will they be able to calibrate their expectations? Do the Government plan to review these arrangements at some time in the future? My noble friend Lord Whitty asked a very pertinent question: what are the cost implications of these amendments? In my estimation, they appear to relate to a comparatively small number of people. If the Minister is not able to tell us, will he come back to my noble friend before Report so that that information can inform the debate, if it takes place then?

Groceries Code Adjudicator Bill [HL]

Debate between Lord Whitty and Lord Browne of Ladyton

Monday 16th July 2012 Lords Chamber

[Lord Whitty]

My Lords, the amendment goes back to the basic problem about the relations within the food supply chain between the supermarkets and small and medium-sized suppliers and all the attempts to enforce the code and its predecessors without statutory backing. Whether we like it or not, there is an atmosphere of apprehension, anxiety and fear among small suppliers to supermarkets, and a feeling that if they raise problems with the supermarkets under the code, they are in danger of retaliatory action at some later stage—their contracts will be ended, curtailed or put on to a less beneficial basis.

I am aware that this was discussed in Committee and indeed there have been discussions about it since it was first raised, but Clause 2 still appears to allow disputes to be referred to the adjudicator only by the supplier themselves or, alternatively, by the large retailer. My amendment would explicitly allow a case to be referred to the adjudicator by a third party—an appropriate trade association or a farming union—and this would relate to issues that covered more than one supplier, or perhaps only one supplier but where there were general implications of the outcome of that particular case. The amendment would allow third- party initiation by a trade association or farming union but possibly also other third parties that were appropriate—for example, an agricultural charity.

This would not be an open-ended requirement. As with the large retailer, the adjudicator would not have to take the case under this amendment. While Clause 2 requires the adjudicator to take a case from the supplier, although not the large retailer, my amendment would give the adjudicator sufficient grounds for not taking it, on the grounds either of it being trivial or vexatious or because of a lack of prima facie evidence. The argument that this would be used against the supermarkets on spurious grounds by campaigners who were opposed to supermarket activity in unrelated fields would not be a good reason for rejecting the amendment. It would relate to genuine supplier problems but it would protect the supplier, the farmer and the small business from the fear of being retaliated against at a later stage. It would support that supplier if the NFU or trade association took up the case.

I appreciate that the Minister may not like the wording—her officials rarely do—but this must be something on which she could go a little further than she did in Committee to assure us that third parties could take such cases. Only that, I feel, would put an end to the apprehension and the fear among small and not so small suppliers, which are at a serious disadvantage with supermarkets. They would be protected under this code and other legislation. I beg to move.

[Lord Browne of Ladyton]

My Lords, I will speak to the amendment standing in my name, which seeks to insert a mechanism for ensuring the independence and the qualifications of an arbitrator appointed under the code by reference to the provisions of this Bill. It generates, I would argue, a valuable opportunity for the Minister to explain a very complex part of this legislation, which, without an explanation in the Official Report of our deliberations, I fear may not be understood by those who come to apply, or seek to apply, the provisions of this Bill in relation to the code.

As we have already heard, this is a unique piece of legislation, because the basis of it is a code that is owned by the Competition Commission. If the code is repealed, then all this legislation becomes redundant. I embarked on the amendment of this particular part of the Bill because of my then limited understanding of both the arbitration legislation as it applied in England and Wales and the Arbitration (Scotland) Act 2010, which has been passed by the Scottish Parliament and, in part, now applies to Scotland, but which is not yet fully commenced. I was unsure how all these things interacted, but I was certain that at some stage it would be necessary for the Government to make it perfectly clear that the provisions of that legislation, which were carefully debated and thought through both in this Parliament and the Scottish Parliament, and were designed to generate an independent and properly qualified process of arbitration, would properly be applied to this legislation when enacted and to the processes that it was creating. The more I got into it, the more I began to appreciate just how important that was.

With the leave of the House, I will take a few minutes to explain some of this complexity but will leave it to the Minister to explain how all this works. In my discussions with the noble Baroness and her Bill team, both of whom have been extraordinarily generous with their time and in explaining this, we have between us uncovered areas in which this Bill and the code could be improved. I have not endeavoured to do that in this particular amendment, and have removed other amendments that I proposed, because I am confident that at some stage in the progress of this Bill the Government will themselves bring forward some amendments that deal with those issues that have now been uncovered.

This amendment, on plain reading, concerns the qualifications and appointment conditions for an arbitrator under the Bill and has had the benefit of shining a spotlight on a particularly unclear and potentially confusing part of the Bill. To understand how this Bill works, one has to understand the interaction of the arbitration provisions in the Bill with the existing arbitration laws in England, Wales and Northern Ireland, and also with the arbitration provisions in the code itself. It is not easy to follow all this. We are not helped by the fact that the Explanatory Notes compound this lack of clarity rather than resolving it. In particular, paragraph 30 states that the provisions of the Arbitration Act 1996 will “broadly” apply and that,

“the Arbitration (Scotland) Act 2010 will broadly have a similar effect in applying the Scottish Arbitration Rules, except so far as this would be inconsistent”,

with the groceries supply order or the Bill. That was not intended to be clear. It is intended just to report the position which is quite difficult to work out.