Pension Schemes Bill (First sitting)

David Pinto-Duschinsky Excerpts

Committee stage
Tuesday 2nd September 2025 Public Bill Committees

[Mr Bedford]

Q Where is that support going to lie—with organisations such as Age UK, charities or the pension provider? Where do you see that balance sitting?

Christopher Brooks: It could lie either with Government and the Money and Pensions Service providing a widespread service, for example. It could lie with charities, or providers could be told to help people with these decisions—they could potentially commission charities. We are working with Aviva to look at running a pilot in the retirement space, which will hopefully go ahead soon and give us some insights into what kind of support people need. People think about their lives holistically, and they are not necessarily thinking about a pension as separate from their current accounts, so we need to think about how it works for people. That is the key thing.

Jack Jones: I think we look at this slightly differently. I am not convinced that any more financial education, guidance, or points at which we need to intervene in the system to ensure that people are equipped to make decisions is the way forward. This Bill recognises that, and the introduction of default retirement products is a recognition that everywhere else in the pension system, it works on the principle of default and generally works quite well. We have seen that that principle is really powerful; if people are defaulted into something, they will stay there, whether that is their contribution rate or the investment options. Defaults are really sticky; we rely on that and make use of it through auto-enrolment, to get people into saving schemes.

More and more, as we find ways in which that does not work, we need to go back and look at fixing the system a little bit so that it works better by default, rather than providing people with more education, because that is pushing against the grain of all of our experience of what works and what is effective. I think that Chris is right that it puts a lot on the governance structures and on the consumer protections there, but I think that is where this Bill has to work. It has to put in place something that will be appropriate for the vast majority of members, and that will work with the minimal amount of engagement—we have to have some kind of engagement on retirement, such as, “This is what I am going to retire and this is where my pension should be paid,” but not beyond that.

[David Pinto-Duschinsky (Hendon) (Lab)]

Q I want to build on the questions that the hon. Member for Mid Leicestershire and my hon. Friend the Member for Bristol North East were raising. Obviously, part of the challenge we face is around the proliferation of small pots; certainly, when I talk to my constituents about issues of long-term retirement planning, that is the consistent theme. The Bill obviously sets out a path to try to deal with some of that proliferation that has been caused since the introduction of auto-enrolment. What are your views on the extent to which the Bill provides the right framework for dealing with that kind of proliferation?

Jack Jones: As Zoe said earlier, we should be here already. It has taken us a long time to get to the point where we have an agreed solution. It looks as if the mechanics of it will work. I think we need to let that bed in and prove that it works. The main concern from our perspective is the £1,000 definition of a small pot. Obviously, from a lot of angles, £1,000 is a lot of money—but as a pension pot it really is not. Looking at this once you have proved the concept and you have a system that works and that hoovers up the smallest pots and those most likely to become orphaned is one thing, but I think if you are looking at helping people to avoid accumulating 10 medium-small pots over their career, we need to look at how to increase that over time.

Christopher Brooks: I agree with Jack. I think the Bill is really strong on small pots and the system that is envisaged will really help. I guess my only comment would be that £1,000 is not a huge amount of money, so maybe over time that amount could be raised, and some kind of indication that that is the intention might be helpful.

[John Milne]

Q Do you think there is evidence that fiduciary duties are not interpreted in a way that optimises outcomes for pensions savers? If so, would you support any change in legislation to help?

Christopher Brooks: Yes; I think a lot of schemes do not interpret it broadly, so they probably take things literally regarding financial materiality—that is obviously very important, but they could probably do more. I think there is a very strong case for reform in fiduciary duties, just to make it clear in the law what it actually means. It is more of an enabling tool for providers, I think, rather than anything restrictive. When there needs to be some direction for schemes to invest in particular ways, I think there is sometimes a bit of reticence. That is true of investing in the UK, maybe with some private finance and maybe with regards to climate change. The larger schemes no doubt do understand it, but all schemes need to understand that they can invest in these things and that that is possible.

I am no expert on this, but, as I understand it the fiduciary duty is all over the place in the law, and sort of hinges on bits of case law and bits of very old legislation, so clarifying that would be a really good move.

Jack Jones: I would agree with that. I think there could be statutory guidance to make it very clear to trustees what their fiduciary duty actually involves, and that it does go beyond that kind of narrow interpretation. As I say, you should take into account your members’ quality of life more generally—for example, investing in ways that support the UK, when that is where your members are, is something that is in their wider interests, and managing systemic risks such as climate change is obviously very material financially, but also has an impact on the kind of world they will be retiring into.

As I said before, we do hear fiduciary duty occasionally being used as a reason not to do the hard stuff and not to think through that. There is nothing inherently problematic there, but clarifying and making sure that trustees are fully aware of the breadth of fiduciary duty would be helpful.

Pension Schemes Bill (Second sitting)

David Pinto-Duschinsky Excerpts

Committee stage
Tuesday 2nd September 2025 Public Bill Committees

[John Milne]

Q But would you agree that that could have very stable returns—say a 5% return for affordable housing, or for a care home—because effectively the customers are also coming via the local authority?

Councillor Phillips: There is great potential in all the activities that local government can do, but the fiduciary duty is where we need that clearly spelt out and some guardrails put in for that.

Robert McInroy: Where the LGPS can potentially bring an advantage to bear is by tapping into its local connections and local expertise—when it can see local investment opportunities that others potentially cannot. To come back to affordable housing and the fiduciary duty, if you are the asset owner, you have to be looking at the returns, and that is a difficult challenge for LGPS funds, particularly when it is in their local areas. You are talking about, for example, whether you push up rent and potentially displace a family or basically taking a lower return as a result of that. It is a very difficult thing to stack up. It is new to the LGPS. We need to make sure there are guardrails around it. Within the Bill it would be useful to bring fiduciary responsibility into the elements of local investment and how that overrides any of the local considerations.

[David Pinto-Duschinsky (Hendon) (Lab)]

Q The Minister picked up a point that I was going to touch on, but I would like to ask about broader consolidation. Councillor Phillips, you mentioned that often councils are wrestling with multiple pools in a small area. I think there is broad consensus that consolidation is a good idea, and clearly this is the direction of travel being laid out by the Bill. What kind of challenges do you see to successful implementation of consolidation and how will the Bill drive that forward?

Councillor Phillips: Let us be quite clear. I think the Government’s frustration, which is shared by many of us, is that we are talking about what is generally accepted to be the sixth largest pension scheme in the world, and it does not punch its weight, which is what it needs to do. That is what pooling, which began in 2016, was meant to address, and to date, it has been successful, but it needs to be better. That is where I see a very big positive of coming together.

[David Pinto-Duschinsky]

Q How do you see the Bill helping?

Councillor Phillips: From that point of view, it is very helpful. Because we are a very transparent pension fund, pressure will be put on some of the pools to make sure that their workings are done in a transparent manner. They are now, but there will be even more pressure because lobby groups will go straight to them rather than the funds.

Consolidation with regard to administration is not quite so easy. The last consolidation was between Northumberland and Tyne and Wear, and that was with maximum co-operation on both sides. This is a very well administered scheme, but bringing two administration authorities together is quite challenging. It needs to be done with co-operation and collaboration, never with a big stick behind it.

Certainly in London, there is a case for some rationalisation of the number of funds, and there is always going to be an issue about some of the smaller funds as they deal with it, but pooling is not just about consolidating your investments. It also brings the opportunity for the member funds that own the pools to start working more collaboratively, particularly on things like communications and other areas of work. There is great potential there. One of the things that the scheme advisory board is very keen to do is to make sure we develop and grow those chairs of funds to be the competent leaders that they are, and make them even better.

Robert McInroy: I think you were asking about the challenges of implementation. It is easy to see the direction on this and to think that there is not much change for the LGPS. There is a huge magnitude of change in these reforms. The LGPS funds and the pools already have a very full to-do list. They have stretched resources. They are asked to deliver an awful lot in a short period of time. They are transferring all of the remaining assets from the funds to the pools—there is still about 30% of those assets to come across in a short period of time.

Two pools have been asked to change their operating model to be FCA-regulated. Every pool has been asked to build advisory functions—that is all from scratch, apart from one. They have been asked to build local investment capabilities as well, which is of paramount importance to be able to kick-start and contribute to the UK economy, and to implement some of these governance reforms, and now we know that two of the pools are being asked to wind up, so there is £100 billion of assets to transfer, which is implicated across 21 funds.

That is a huge amount to do under any timescale. Some of what is envisaged in the consultation is that this would be completed in a little over six months’ time. That puts risk on some of these reforms, and I think that should be recognised.

[David Pinto-Duschinsky]

Q Clearly you are talking about a large administrative challenge, but also about building capacity. We know the funds need capacity to raise their investment sophistication and their ability to invest in a broader set of assets. What do you think the minimum efficient scale for this is, and how quickly could the pools get there?

Robert McInroy: At the moment, there are eight pools across the £400 billion-ish of assets. I believe the plan at the moment is to reduce that to six. You would imagine that that gives a big enough scale. Some of those pools will be £100 billion-plus; that should be able to punch its weight internationally, I would imagine. The LGPS itself is of course open to accrual and to new members joining, so that is just going to grow over time. In some ways, I think these reforms set the plan for the future as the scheme continues to grow.

[Kirsty Blackman (Aberdeen North) (SNP)]

Q I am pleased to hear you talking about what scheme members want, not just in terms of the return that they are expecting, but also the projects that are invested in.

My question is about consolidation and local concerns that people might have. For example, they may not want a wind farm invested in because they are worried about the infrastructure that goes alongside that. If there is consolidation, will that remove the ability to take account of local concerns and to find great local investment opportunities? Will it dilute the input that people have locally, because it is taking it further away from them, or do you think it will be okay?

Councillor Phillips: As we already know, the establishment of the pools does take it away. There is no denying that. The important thing is to have member representation on pools. The scheme advisory board has always been supportive of that, although you need flexibility in how you do it; I certainly would not go for 50:50, because of the governance and regulatory responsibilities that the administration authorities have. I think Border to Coast particularly has employee representatives on there, and that works very well. In particular funds, you will have representatives on the committee and on the pension board. That is always important.

Getting the right engagement is always going to be a struggle, with all the rest of it, but, particularly with some of the ESG issues, that helps to better understand some of the issues. Of course, elected members that sit there are representatives of their community as well. They are aware as well. They are also aware that when they sit at the table on a pension, they have a responsibility first and foremost to that pension.

--- Later in debate ---

[Mr Bedford]

Q Going back to the consolidation of small pots, have you any thoughts or comments on the timeframes involved in how that would be implemented, particularly in the context of the roll-out of the pensions dashboard, which has taken quite some time to be rolled out in the industry?

Patrick Heath-Lay: The Government have put forward a default consolidator model. We are completely supportive of that; we think it is the right solution to tidy up the 13 million small deferred pots that are out there and those that are being created on a daily basis. That model has been done with extensive consultation with the industry.

To go back to the first question, which was about all the different options that have been considered before, we do think that this is the right approach. A couple of things around it are critical. First, we need to make sure that the technical solutions—the IT capability or infrastructure—should be as efficient as possible. We are contributing to the various pieces of research being done at the moment to evaluate which models are in existence and ready to be utilised. There is no doubt that the dashboard will contain some elements that will be helpful, such as a pension finder, that will be helpful, and I suspect that they will utilise pieces of that technology. But I do think—and I suspect the conclusion will be—that we need something new. Some of the expertise in the industry can be leveraged. I suspect that that is expertise that our organisations can provide. Given that we have already addressed the big pension savings gap for savers, we can help to develop that model.

On whether the solution is doable within the timeframe, 2030 is a big ask, but we should have that target to go after. We should try to be in a position where default consolidators exist in the market, we are developing the solution and we are able to solve the problem, because the number of small pots being created almost daily by the industry is a big problem for savers.

Ian Cornelius: I agree with Patrick. It is a problem that needs fixing. We also support the default consolidator approach. The sequencing is sensible: we want scheme consolidation first and then small pots, because there is no point in going through the complexity of consolidating small pots before consolidating at the scheme level. Dashboards will help, but they will not solve the problem. A solution is required, because this is driving a lot of cost and a lot of complexity. It would be nice if it were sooner than 2030. Given the ambition of the Bill as a whole, I think that that is probably realistic, but it does need to come after scheme consolidation, as I say.

Patrick Heath-Lay: The requirements on those organisations that choose to apply to be default consolidators need to be of a good standard. Our organisations operate a single-pot model. Whenever anyone rejoins from a different employer, their money goes into exactly the same pension pot. That is not a common model across the industry. Things like that should be thought through when defining the requirements for being a consolidator. Those that wish to apply need to hit a good regulatory standard to ensure that value is delivered through those models.

[David Pinto-Duschinsky]

Q Patrick, we have heard loud and clear your message that getting the value for money framework right is at the core of this. The Bill aims to put that on a sound footing. Which elements are required to get it right? How do you think the Bill will help to build them up?

Patrick Heath-Lay: As a package, the Bill brings forward the concept of value for money in a general sense. We need to move the conversation in our industry, particularly the conversation around workplace pensions, to the subject of value. We are all here to deliver value for members. The bit that always gets a lot of conversation is what value really means, but you cannot walk past the three fundamental drivers of a pension proposition, which are the investment return we give our members, what we charge them for it, and how our service shows up for them, probably in those moments of truth when they need us for guidance. Those are the three core elements to value, which we should not walk past.

We see this as an incredibly important area. I certainly believe that we should try to get this right as an industry, as best we can, from day one, because I think that it will be an important measure that we—regulators, Government, everyone—will lean on to understand how these reforms are playing through.

As an organisation, we have led a pound-for-pound initiative that others have joined. We brought in expertise from Australia, which is about 20 years ahead of us, and brought together a group of providers that are effectively going to dry-run some value for money measures and utilise that concept to provide some findings to regulators and Government that will hopefully help the iteration of our value for money framework. We really do see this framework as an important area, and I would like to see those three elements at its core.

Ian Cornelius: The focus on value has to be the right thing for our members. That is what they care about; that is what we are here for. There is some complexity to work through, such as how you measure value and what timeline you measure it over. Quite lot of engagement is required. We are piloting and trialling it; we almost certainly will not get it right the first time. It will be important to make it as practical and simple as possible. As Patrick said, it has real potential, in combination with the rest of the Bill, to shift the focus from cost to value. In the past, there has undoubtedly been too much focus on cost and not enough on value.

[Kirsty Blackman]

Q This is about people who do not get financial advice, which is the vast majority of people, and their understanding of pensions and what they are likely to get. On a DB scheme, you get an annual statement that says you will get x amount a month or x amount a year. On a DC scheme, it is more like, “This is your total pot.” As everybody’s circumstances are different, they have no idea what that might actually look like if they were to get it on a monthly basis. I appreciate your positive words about the guided retirement and the targeted support. Do you think there is potential in the future for moving towards ensuring people get that advice earlier, so they can ensure the sufficiency of their pot, as well as ensuring that they are making the right decisions when they take that pot?

Ian Cornelius: It is definitely desirable. One of the challenges with auto-enrolment is—it is a positive and a negative—that people are not engaged. Inertia has worked really well, but you have to work to engage them to make sure they are contributing the right amount, thinking about what they will need in retirement and thinking about their circumstances. For example, at NEST, only 40% of our members are registered with us online, so we have a really big job to play to engage more of them, get them to register, and get them accessing the tools and support that are available to deliver the best outcome for them. It is our fiduciary duty to do that. There is a lot more that we can, need and want to do in that space. Guided retirement is a big step forward. Targeted support would be helpful. There is a big challenge for the whole industry there.

Patrick Heath-Lay: I agree. As this unwinds, we should think a little bit more about how engagement will help. It certainly is a big driver. Both the introduction of these propositions and the guidance and targeted support we can provide through those processes will be important, but we also have to accept that even in the most mature economies’ pension systems, people still do not engage very closely on this. Even when they do, they find it incredibly difficult to interpret what they are being told. How many people can do good compound interest calculations, for example? It is sometimes mind-boggling what we expect people to know. There has to be more onus on us through those processes, as an industry, for the guidance that we provide and the obligation on us to enable effective, accountable support to be there. There is much more, and this Bill goes a long way to enable us to do that.

--- Later in debate ---

[Rebecca Smith (South West Devon) (Con)]

Q Given the international experience that both of you have in this realm, I am interested to know whether there is either anything in the Bill that you think is a red flag or anything that you think is a missed opportunity and not in the legislation in front of us today.

Michelle Ostermann: That is fascinating. I came to the UK, and back to the UK, because I have so much enthusiasm for the UK and the pension system. I am very fortunate to be the chair of the global pension industry association, so I study pension systems around the world and am quite familiar with many of them. The UK pension system is the second largest in the world by size if you include underfunded pensions. It is one of the most sophisticated, but it is the second most disaggregated. As I think a few of my peers mentioned before we got up here, it has fallen behind, frankly. I think the motives that are in this Bill are exceptionally important—they are foundational. I love that we are speaking on scale and sophistication. These are absolutely key, in both DB and DC. I want to underscore that; it is really key.

One thing that is not spoken of quite as much is the concept of an asset owner and the importance of governance. In relation to the successful countries that I have seen, which have mastered the art of pensions and the ability to translate pensions into growth, it is not a proven model, but there is a best practice such that countries are able to make growth by leveraging pension systems. I think that right now we are trying to solve a problem of two things: reshaping the pension system and trying to solve the need for a growth initiative. They are one thing in my mind; they really are one thing. It is not a surprise that as we have de-risked the pension system over two decades, it has, I suspect, quite directly, but at least indirectly, affected overall economic growth.

Making members wealthier pensioners in general and less dependent on social services is what many countries are trying to do and use their pension systems for. I see that out of the commission that is being started, so I am most excited about the next phase. I think there is a lot of potential, and we at the PPF are doing quite a bit of research and want to be able to feed some global ideas into that.

Morten Nilsson: I come from Denmark originally and I think, to echo some of what Michelle said, scale just matters in pensions. The Danish pension industry has been fortunate to have few and relatively large schemes. One of the things I saw when I came over to the UK 15 years ago was that the industry here is very fragmented, and that fragmentation means also that there are so many conflicts of interest in the market. That in a way makes it quite hard to get the best outcomes, and that of course leads into the governance models that Michelle talks about. So this Bill is something we very much welcome across what it is covering. I think it is a really good initiative, but I think scale matters, and governance really matters. I would not underestimate how big a change it is, in the defined benefit sector, that we are moving from two decades of worrying about deficit into suddenly worrying about surpluses and having very mature schemes, which is the other thing that is important. Most of the DB schemes are closed.

If I talk about the BT pension scheme, the average age is 71, so they are pretty old members and that means there is a risk level, from an investment perspective, that really matters. We are paying out £2.8 billion a year in member benefits. That means liquidity is really important. It is really important that we have the money to pay the members and that we do not end up being a distressed seller of assets.

So there is quite a lot in that evolution we are on, and when we go into surplus management or excess funds—Michelle was talking about this at macro level; we would be managing at our micro level in each scheme— I think it becomes really critical that we have the right governance to manage what is a new era. I would really recommend that the Pensions Regulator issue guidance as soon as possible on all this, because it will be quite uncomfortable for a lot of trustees. It will be quite difficult also for the advisers in how we manage this new era.

[David Pinto-Duschinsky]

Q I am really glad that you both mentioned governance, because that absolutely stands at the heart of this. You also mentioned conflicts. We have not talked much about the role of consultants and things like that, but it is clear that you think the framework laid out by the Bill will be helpful and a key part of mobilising those things.

Conversations that I have had also flag up the importance of culture among trustees. We can give people the tools, the powers and the permission to invest, and we can be clear in the framework we set up, but, culturally, they may still be very risk averse. Of course, some of that is appropriate because they have to safeguard member benefits, but there is a point about whether they are overly cautious and about how one creates the appropriate culture to go with the change. From your perspective, what is needed to create the right culture to go alongside the right governance?

Michelle Ostermann: I have one small observation from when I first came to the UK. I recognise that there is a very strong savings culture, but not necessarily an investment culture, and there is a distinct difference there. I even notice the difference when we talk about productive finance targets. We speak in terms of private assets, but there is a difference between private equity and private debt, and between infrastructure equity and infrastructure lending. All those lending capabilities are here in this country. I feel that the debt sophistication is strong, but where it lacks is the equity.

I am a Canadian. With one of the largest Canadian schemes, we had no problem coming in and buying up assets here in the UK—you may have noticed. We own a lot of it, and with Australia, most of it. The supply was never an issue for us. We brought the scale and sophistication, but what we did not have was a local British anchor. We did not have an anchor investor. We did not have a home-grown Ontario Teachers, a Canada Pension Plan or even an ATP that we could use as the local one. I see that the PPF, NEST and Brightwell can be that. We are still not megafunds. I know that we are referred to as behemoths and megafunds at £30 billion and £60 billion, but the peers with £100 billion, £200 billion and £500 billion are those that are putting in £0.5 billion or £1 billion in one investment. They are not lending, but investing.

That is the biggest difference I notice: the definition of scale and the degree of sophistication. It is even about sophistication in the governance model, and having a board and a management team with that sophistication. It is about having a management team with some power that you are hiring out of investment, and being a not-for-profit and an arm of the Government that is allowed to put in that sophisticated capability, with a board that can properly oversee it so it is not done without proper consideration.

Morten Nilsson: I think it is quite critical that you have trustee boards that are supported well by regulation and guidance, as we talked about before. It would also be helpful to start to focus on the management teams that are supporting the trustees. Cultural change is always very difficult. We must acknowledge that we are coming out of a situation that was really quite difficult for a lot of trustees and sponsors in terms of finding out how to fix the big deficits that schemes had. We must acknowledge that that is where we are coming from and that is the mentality we have had for decades. Regulation and guidance is still all over the place, and we must work through how we move that forward. I really recommend more guidance from TPR and, sooner rather than later, more guidance on surplus extraction. That would help a lot of trustees to take more risk and think in a more balanced way about risks.

Of course, if we are considering allowing excess funding to go back, we need to ensure that we are doing that on a prudent and well-considered basis. It is an educational challenge more than anything, but it is also about the advisers. The market really needs to get comfortable with investing for the longer term. Within that, it is critical that we move away from being obsessed with a mark-to-market, day-to-day obligation. We measure our liabilities on one day of the year and then we might panic if there is a little swing in the market, but we are actually working through quite a long horizon and therefore we can smooth that out in a different way. We need to think about how we look through some of these blips.

[The Chair]

If there are no further questions from Members, I thank the witnesses for their evidence. We will move to the next panel. Thank you very much indeed.

Examination of Witnesses

Chris Curry and William Wright gave evidence.

Welfare Spending

David Pinto-Duschinsky Excerpts

Tuesday 15th July 2025 Commons Chamber

[Dr Mullan]

As others have pointed out, the Government put forward welfare reforms that were supposed to save money but ended up costing money, and this is yet another attempt to placate their Back Benchers in a way that we cannot afford. We must be clear about our record: we brought down absolute child poverty when we were in government. Labour Members are happy to quote figures on relative poverty and take them at face value, but when we quote figures on absolute poverty from the same datasets, they do not want to hear it. I am clear that I care more about absolute poverty, and how much someone actually has to spend on things that they need, than I do about relative poverty.

[David Pinto-Duschinsky (Hendon) (Lab)]

Does the hon. Gentleman also care about deep poverty? That increased to a point where four in 10 children who were in poverty under the Conservatives were in deep poverty. Will he apologise for that?

[Dr Mullan]

I think we need to look at the absolute poverty figures and at what difference we can make to them—and what makes a long-term difference to the number of people in poverty of any kind is employment. We reversed the decline in employment, but we are now seeing it get higher every day under this Government’s policies. That is what is bringing even more people into poverty—their record on the economy and on employment.

--- Later in debate ---

[Deirdre Costigan (Ealing Southall) (Lab)]

I have visited St Anselm’s food bank in Southall on many occasions and spoken to its brilliant volunteers, but the people who find it hard to speak to me are those collecting the food. Being poor and unable to feed their family is not something they want to shout about. I can see the distress written on their faces. Those mums and dads have not decided to live in poverty. Many of them have jobs, but they just cannot make ends meet. They are the casualties of 14 years of Conservative Government—of public services that were cut to the bone, leaving people without a vital safety net when things go wrong; of a jobs market that left workers on bargain-basement terms and conditions and low-wage jobs with no protections; and, of a welfare system with a basic rate that just was not enough to live on, instead pushing people into relying on sickness benefits.

[David Pinto-Duschinsky]

Does my hon. Friend agree that, exactly because of those problems, we should all welcome the uplift to the basic rate of UC, which will lift the income of 6.5 million families?

[Deirdre Costigan]

I absolutely welcome that point. The Conservatives put 1 million more children into poverty, with 800,000 children now relying on food banks such as St Anselm’s to eat. In the motion today, the Conservatives have the bare-faced cheek to blame those families, as if parents choose to let their kids go hungry. The only people to blame for this are Liz Truss’s Conservative party, who gambled with the country’s finances, betting it all on pie-in-the-sky promises they knew they could not pay for, bringing the economy crashing down overnight. Families in Ealing and Southall are still suffering the consequences; 40,000 of them are having to go to the food bank this year.

Under this Labour Government, we want to make food banks the exception and not the norm. That is why Labour has opened new breakfast clubs, such as the one in Wolf Fields in Southall; expanded nurseries, such as in Allenby primary; extended free school meals for all those on universal credit; and reduced energy bills by £150 for more than half a million Londoners.

We know, however, that we need to change the whole busted system that puts people into poverty in the first place. That is why Labour is ending the low-paid, bargain-basement jobs of the Tory era. Our Employment Rights Bill will end zero-hours contracts, with families no longer wondering from week to week if they can get enough hours to afford food. We are stopping fire and rehire, extending sick pay to low-income workers, and we have raised the minimum wage for 3 million working families. Our next step is to address the injustices faced by those working in the gig economy.

Universal Credit and Personal Independence Payment Bill

David Pinto-Duschinsky Excerpts

Committee of the whole House & 3rd reading
Wednesday 9th July 2025 Commons Chamber

[The Chairman of Ways and Means (Ms Nusrat Ghani)]

I call the final Back-Bench speaker, David Pinto-Duschinsky, after which I will call the Liberal Democrat spokesperson.

[David Pinto-Duschinsky (Hendon) (Lab)]

I rise to speak against amendment (a) to amendment 2, amendments 45 and 52, and new clause 12.

The creation of the modern welfare state by the 1945 Labour Government remains one of our proudest legacies. At its heart was the powerful idea that people should be protected from hardship and supported to realise their full potential. Underpinning that vision was a clear principle: everyone who can work should work, not just for the dignity and agency work brings, but because it is the most effective route out of poverty. Children in workless households are five times more likely to grow up poor than those in households where every adult works.

That principle holds true today, but it is under strain. One in 10 working-age people is out of the labour market; among young people, that figure is one in eight. This is not a global trend, but a challenge unique to the UK, rooted in the welfare system’s design. Too often, that system locks people with health conditions and disabilities out of work; too often, it penalises attempts to get ahead and fails to offer real support; too often, it writes people off.

Disabled people in the UK have an employment rate 29% lower than those without disabilities and face a wider unemployment gap than many of their international peers. Their poverty rate is 10% higher. This is not compassion. We owe it to these individuals and to the welfare state’s founding principles to fix this problem. We cannot avoid change or fall back on impractical slogans—to do so would be to abandon those who most need help.

Yet that is what these amendments and new clauses do. I shall start with amendments 45 and 52 and new clause 12, tabled by the Opposition, whose Benches are empty. These measures reveal a lack of seriousness and of a plan. The Tories presided over this crisis of opportunity and soaring claimancy. They failed to reform the system, to address the disability employment gap or to tackle fraud, which tripled on their watch. Throughout this debate, they have been unable to explain their alternative—the shadow Minister, the hon. Member for East Wiltshire (Danny Kruger), whom it is good to see in his place, recently admitted as much, saying that he could not say exactly what he would do—so they resort to gimmicks.

Amendment 45 demands that all assessments be face-to-face, forgetting that it was the Conservatives who cut face-to-face assessments by 90%. If there were an Olympic event for brass neck, they would win the gold medal every time. This proposal is unworkable, denying frontline managers discretion—a fact the Conservatives essentially admit in the small print. It is also unnecessary; unlike the Conservatives in government, this Government are restoring most assessments back to being face-to-face.

The same applies to amendment 52 and new clause 12. PIP already has strict residency and qualification rules and is needs based. These proposals would not effect meaningful change, but would slow down reform. Once again, this is gesture politics—the Conservatives do not have a plan.

While the Opposition admit a problem but offer no plan, amendment (a) to amendment 2 seems, I fear, to deny that there is a problem at all, proposing simply to remove all changes to the LCWRA. The changes those behind the amendment want to scrap are vital to rebalancing the system, which will not just remove disincentives to work but enable the largest above-inflation increase in basic jobseeker benefits since the 1970s. These benefits will rise £725 a year for 6.5 million people by 2029, helping 15,000 people in my constituency. Removing these changes risks losing measures that would lift 50,000 children out of poverty.

None of this is easy. We are talking about real lives, not abstract policies. I understand the anxiety this debate causes, but freezing the system in aspic and ignoring its failings would lock in current injustices and create future problems. We should start reform by reaffirming the system’s basic purpose: to protect and treat all with dignity, but also to empower people and give them true agency. That means recognising that some cannot work, ensuring protection for the vulnerable, and listening to and co-producing with disabled people. However, it also means ensuring that those who can work do so, offering support and holding employers to account. I believe that the Government’s proposals do so.

Just as Attlee’s Government reimagined the role of the state after the war, so we must reimagine it now after the upheavals of the pandemic, economic change and rising ill health. The world has changed, and our welfare system must do so too. We must reform the system—not in spite of Labour values, but because of them.

[The Chairman of Ways and Means (Ms Nusrat Ghani)]

I call the Liberal Democrat spokesperson.

Disabled People in Poverty

David Pinto-Duschinsky Excerpts

Tuesday 17th June 2025 Westminster Hall

[David Pinto-Duschinsky (Hendon) (Lab)]

It is a pleasure to serve under your chairship, Ms Jardine.

If we are to be serious about tackling poverty among disabled people, we need to be honest and focused on tackling its root causes and on making sure that the system is sustainable. The overwhelming driver of poverty among disabled people is low levels of employment. Only 54% of disabled people are in work; that is 30% lower than the average for people without disabilities. Shockingly, 43% of disabled people are economically inactive, and our employment rates lag far behind those of other countries, such as Canada’s at 62%. We cannot just ignore worklessness as the driver of poverty. The JRF says that people in full-time work are five times less likely to be poor than those in no work.

[Ian Byrne (Liverpool West Derby) (Lab)]

Will my hon. Friend give way?

[David Pinto-Duschinsky]

No thank you; I have very little time.

We have to deal with the root causes, so we have to focus on work. We also have to deal with the sustainability of the system, which is currently unsustainable. PIP claimant levels have risen at twice the level of underlying ill health. The rise since 2016 alone is equivalent to the entire police grant for England and Wales. If we are to sustain the system for the long term, we must make it sustainable. The proposed changes will not affect 90% of people. They will protect the most vulnerable and make the system fit for the future. That is why we should support them.

Mansion House Accord

David Pinto-Duschinsky Excerpts

Tuesday 13th May 2025 Commons Chamber

[Torsten Bell]

My hon. Friend is absolutely right. The lower Thames crossing has been consented, and it is another example of this Government getting on with getting the country building again, and when we come to the spending review—[Interruption.] If I were in the Conservative party, I would not be talking about the lower Thames crossing; I really would not be. The regime for planning that the Conservatives put in place meant that hundreds of millions of pounds have been taken to build precisely diddly squat. This Government have given consent, and we will be setting out in the coming months the provision for that scheme to go ahead.

[David Pinto-Duschinsky (Hendon) (Lab)]

I congratulate my hon. Friend and Treasury colleagues on helping to deliver such an important agreement. The accord will unlock up to £25 billion of additional capital. It is a huge vote of confidence in the Government’s demand-side reform agenda to get Britain building and in our economic strategy, providing stability. What steps will the Government take to help make sure that investment is ramped up as quickly as possible, and to ensure that regulators help encourage investment of pension funds directly in real economic assets, for instance by looking at changes to the matching adjustment?

[Torsten Bell]

I thank my hon. Friend for his comments. It is nice to hear the positivity coming from him and other Members in this House who believe that Britain can do better than the last 15 absolutely terrible years. The investments we will be making, delivering on the supply of capital with the likes of the reforms today, while allowing building for housing, transport projects and the rest, are exactly what will make the difference in the longer term.

Personal Independence Payment: Disabled People

David Pinto-Duschinsky Excerpts

Wednesday 7th May 2025 Westminster Hall

[David Pinto-Duschinsky (Hendon) (Lab)]

A strong social security system is not just the cornerstone of a welfare state, but a hallmark of a decent society. However, it is exactly because the system is so essential that we must safeguard its future. It is our duty not just to help the most vulnerable today, but to ensure that the system is sustainable so that it can offer support tomorrow.

That is the central challenge when we consider PIP. The number receiving it has more than doubled in the five years since the pandemic, and more than 1,000 new people join it every single day. Although health conditions have become more widespread in the years following covid, due mainly to the Conservatives’ terrible mismanagement of and under-investment in the NHS, the number of people on health-related benefits such as PIP has, on some metrics, increased at twice the rate that underlying health conditions have.

Those of us who believe in the welfare state cannot simply ignore this issue, and neither can we posit speculative new revenue sources to wish the problem away. Some of my hon. Friends have mentioned a wealth tax as a possible solution. I say to them gently: if only it were that easy. Dr Allin-Khan,

“no country in the world has ever successfully had a wealth tax”.

Those are not my words, but those of Paul Johnson, head of the Institute for Fiscal Studies.

If we are to protect the system, we must not seek to freeze it in aspic or ignore the problems it faces. Instead, we must confront the problems head on and seek reforms that will allow the institutions of the welfare state and the values they encode to endure.

Public Authorities (Fraud, Error and Recovery) Bill

David Pinto-Duschinsky Excerpts

Report stage & 3rd reading
Tuesday 29th April 2025 Commons Chamber

[David Pinto-Duschinsky (Hendon) (Lab)]

I rise to speak against amendments 2, 4, 5, 6, 8 and 9, and new clauses 12 and 15.

Fraud in the benefit system affects us all. It costs us as a country almost £1 million an hour. It takes money from the most vulnerable in society and undermines the legitimacy of and public support for our social security system. However, many of the amendments proposed simply do not recognise the vital need for this legislation. Some, such as amendments 2 and 9, would hamstring the Bill by preventing us gathering key information. Others, such as amendments 8, 5 and 6, would limit the effectiveness of the Bill and make its powers more difficult to use. Others, such as amendments 4 and new clauses 12 and 15, would seek to delay its effects.

These amendments, however differently proposed, all suffer from the same pathology: they fail to take fraud seriously. We have heard a number of speeches today from opponents of the Bill, but we are yet to hear from them any serious practical suggestions about how we might tackle fraud. These opponents say that they are concerned to protect the vulnerable, but I say gently that they can offer no proposals on how to prevent the fraud that is stealing from the neediest in our society.

Many Members are coming from a genuine place of concern about how to strike the right balance between protecting the public purse on the one hand and the privacy and rights of claimants on the other. I think the Bill gets the balance right. The powers it provides are proportionate.

[Rebecca Smith]

Will the hon. Member give way?

[David Pinto-Duschinsky]

I have limited time, so I will make progress.

The powers the Bill provides are proportionate, measured and ringed with safeguards. It is a mark of this that, as we heard from the Secretary of State on Second Reading, the Information Commissioner has stated that the Bill as currently drafted has addressed their previously stated concerns.

As well as being proportionate, the powers are necessary to fight the ever-more sophisticated frauds that we are facing. Over the past decade, financial institutions have extensively overhauled their use of technology and data and their approaches to the evolving fraud threat, yet the Government have not. It is illuminating, but perhaps not surprising, that while social security fraud has risen dramatically post covid, fraud volumes and losses in the financial services sector, including credit card fraud, have fallen according to UK Finance. The public sector has paid a steep price for not modernising its anti-fraud approach and failing to adopt industry best practices. It is a gap that this Bill seeks to address.

Most of all, the measures in the Bill are crucial for protecting the vulnerable and safeguarding the legitimacy of the system itself. Our social security system rests on public consent and a belief that money is fairly spent. Fraud and error chips away at this social contract, and it takes money from those who need it most. The public in Hendon and across the country expect us to take action. There is nothing progressive whatsoever about permitting fraud. The only people who benefit are the criminals who exploit our system and those who wish to undermine its role as a cornerstone of a civilised and fair society.

For the sake of the most vulnerable, the taxpayer, fairness and the system itself, I hope the House will join me in supporting the Bill and voting down those amendments.

[Kirsty Blackman (Aberdeen North) (SNP)]

There continue to be many problems with the Bill, but I recognise that the Minister and his team have had extensive conversations with the Scottish Government and made a number of amendments as a result. I welcome the communication between the two Governments and urge the Minister to ensure that the DWP team have extensive conversations in advance of the coming welfare Bill so that it will not need so many Government amendments on Report for how it interacts with Scottish legislation and Scottish systems.

I turn to new clause 1 on carer’s allowance. It would be completely fair to wait until a review has been done—there needs to be a significant look into that—as clawing back money from people without seeing the results of that review would be incredibly problematic. I am therefore happy to support the new clause.

On sickfluencers, I am concerned that although the shadow Minister has tried to draft new clause 21 to exclude people giving advice, it might unintentionally catch some of those people. On that basis, I am not keen to support it as I would be worried about people who offer genuine advice being caught up in that. However, I understand that she attempted to draft it carefully to try to avoid that.

I would be more than happy to support amendment 11 —the SNP will support it—on the suspicion of wrongdoing. I am thinking in particular about the speech made by the right hon. Member for Hayes and Harlington (John McDonnell). I was not going to mention the propensity of former MPs to claim things fraudulently, but in looking at who actually costs the taxpayer significant amounts of money, if the Government were to say, “We know that people who hold millions of pounds in offshore trust funds often dodge tax, so we are going to survey all their bank accounts,” I imagine that there would be some sort of uprising, particularly from some wealthier people we are aware of. But because the Government are saying, “It’s cool; it’s just poor people who will be impacted,” we are all expected to assume that this surveillance is fine. It is not fine; it is an absolute imposition on people’s lives. As many have said, it is treating everybody as though they are fraudsters.

Let us look at the amount of money set to be saved. The Government will save less money annually than the DWP makes in overpayments. Rather than imposing on so many people’s civil liberties, surely cracking down on DWP official error overpayments, which would save more money, would be a better place to begin. It is absolutely daft.

I completely agree with new clause 7, tabled by my colleagues the hon. Member for Brighton Pavilion (Siân Berry), particularly in relation to the reasonable expectation that people could understand that they had been overpaid. A constituent contacted me recently because they had a letter telling them that they are to be migrated to universal credit. They are terrified that they will be deported because the word “migrated” was used in that letter. They do not understand the language used by the DWP. Given that universal credit is so complicated to calculate, so many people could not reasonably have been expected to understand that they were being overpaid. The DWP should take that into account before looking at mass surveillance.

PIP Changes: Impact on Carer’s Allowance

David Pinto-Duschinsky Excerpts

Thursday 27th March 2025 Commons Chamber

[Sir Stephen Timms]

I very much agree that this all needs to be done in a managed and compassionate way, which is exactly what we are doing, so I do not agree that it is being rushed. As I have said, the changes will not happen for more than 18 months—they will not take effect until November 2026. They will not affect current recipients of personal independence payment until their first award review after November 2026, and review periods are typically three years, so this is definitely not being rushed. It will happen in a properly planned, staged and careful way.

The hon. Gentleman referred to couples losing £12,000. I think he must be referring to instances of people who receive personal independence payment and also receive carer’s allowance for caring for their spouse—he is right that there are some instances of that. There are couples for whom that happens both ways. The transitional arrangements we are consulting on, which are referred to in the Green Paper, need to take account of that incidence, but it is absolutely the right thing to do, to ensure that personal independence payment continues in the long term as part of a sustainable benefit system.

We do have to make some reductions, as I think the hon. Gentleman acknowledged. If he has another idea on how that can be done, I am interested to know what it is. By concentrating on those whose impairments are the most severe, which the proposed changes will do, we will be able to ensure that the benefit is there for the long term and that it is sustainable.

[David Pinto-Duschinsky (Hendon) (Lab)]

Does my right hon. Friend agree that in order to safeguard the future of the welfare system, we must ensure that it is sustainable?

[Sir Stephen Timms]

My hon. Friend is absolutely right; we have to do that. Five years ago, we were spending £12 billion on personal independence payment, and this year, in current prices, we will spend £22 billion. The Government have to address that, precisely as he says, in order to ensure that this crucial safety net is there for the long term. We will not be means-testing it, freezing it or converting it into vouchers, as the Conservative party suggested; we want it to be a cash benefit that can meet the needs of those who depend on it.

Winter Fuel Payment

David Pinto-Duschinsky Excerpts

Wednesday 19th March 2025 Commons Chamber

[Dame Karen Bradley]

What was happening then was once in a generation, and it was not a real increase in earnings; it was merely that people had gone from 80% of their earnings back to 100%. When earnings had gone down by 20%, we did not cut the state pension but continued to increase it in line with the triple lock.

I want to make a point about universal benefits as opposed to means-tested ones. The Labour party seems to think that a universal benefit is bad because somebody who does not really need it might receive it. I take the other view: it is important that we get to as many people as possible who need it, and if that means a few people at the top end of the earnings level get a benefit they might not need—

[David Pinto-Duschinsky (Hendon) (Lab)]

Given that the right hon. Member’s belief is so strong, will she enlighten me on whether she voted to strip child benefit from certain families, as was Conservative policy? That was a universal benefit.

[Dame Karen Bradley]

The hon. Member makes a good point, and that was a difficult decision because it was the way we could ensure that those at the higher end of the earnings spectrum were taxed on their child benefit. That is a different way of dealing with a benefit that some people may not be in need of but are in receipt of. It would have been perfectly possible for the Government to tax winter fuel payments. That would have meant that those on £13,500 were still getting the money they needed and the Richard Bransons of the world would be paying tax on it. That was a choice available to the Government; they chose not to do that. They chose to just take the benefit away.

The fact that child benefit goes automatically to mothers is an incredibly important point, and winter fuel allowance going automatically to pensioners was valuable to them. I ask the Government and the Minister, who I know well and who is an honourable and decent gentleman, whether they might consider putting in some form of transitional arrangements, rather than having the cliff edge that hurts many pensioners. I also ask whether they will give us the information about whether there is fraud and error in the system now. Will the DWP accounts be affected by the fact that the winter fuel allowance has been taken away in this way and more people may be guilty of fraud and error? Will the Minister give us information on the impact that the measure has had on pensioner health? That matters vitally to us all.