Parliamentary Contributory Pension Fund

David Winnick Excerpts

Monday 17th October 2011 Commons Chamber

[Sir George Young]

Yes; I believe that to be so. There has been no representation on the issue the hon. Lady raises. There are some changes in the composition of the trustees to reflect IPSA’s responsibility, as part of the 2010 Act.

[Mr David Winnick (Walsall North) (Lab)]

Will the right hon. Gentleman give way?

[Sir George Young]

I propose to conclude.

Independence is a crucial part of the process of restoring trust in Parliament. Any decision to defer the transfer to independence would result in MPs continuing to determine their own remuneration, which the House has firmly rejected. It is not incompatible—this goes back to some of our discussions during the debate—to argue that responsibility for our pensions should be made independent and, by agreeing to the motion today, to send a strong signal about the direction we feel the scheme should take in the light of the application of the Hutton recommendations to other public service schemes.

Subject to today’s debate, I will move as quickly as possible to commence the relevant sections of the CRAG Act, transferring all responsibility for MPs’ pensions to IPSA. Once responsibility for MPs’ pensions has been handed to IPSA, the House will have finally relinquished the power to set the terms of its own remuneration. I hope that that will represent a significant further step in drawing a line under the problems of the past and in helping to rebuild public confidence. I commend the motion to the House.

--- Later in debate ---

[Ms Eagle]

We all have our IPSA stories, and we could probably dine out on them—with each other, and we would not claim it back. We all have stories about some of the absurdities of the scheme, especially at the beginning, when it was bedding in. There has been considerable progress, and I would like further progress to be made. There are ongoing ways in which we in this House can bring to light any remaining absurdities, and I hope that we can continue to iron them out. The principle of independent determination is right. IPSA seems as good a body as any—not withstanding the chaos at its beginning—to undertake all that responsibility. Clearly, we will have to wait and see whether my confidence will be rewarded, but I am willing to give IPSA a try. I know that the hon. Gentleman is somewhat more sceptical about the authority than I am.

[Mr Winnick]

When the Leader of the House spoke, he was justifying, on behalf of the Government, what is happening to public servants across the country, including many of our constituents who are on relatively low pay, and justifying the attack on their pensions. I certainly do not agree with what is happening, and I am sure that my hon. Friend the Member for Wallasey (Ms Eagle) does not.

[Ms Eagle]

I will come on to make a few short, in-order remarks about that aspect of our debate, but I think that most Members of the House would agree that we cannot expect to be treated differently from other public sector workers; that is a principle that most of us would share.

I was talking about appropriate Member representation on the trustee board, and the fact that IPSA, under the primary legislation and the order, will have to obtain the trustees’ consent before making changes to the administration of the scheme or the management of the scheme’s assets. Again—this is an important principle—it is entirely in keeping with the usual practice of other funded schemes. It is important that we maintain that parallel.

The order will change the legal structure of the parliamentary contributory pension fund. It will become an IPSA scheme and the power to amend it will be vested in IPSA rather than in the Government via regulations tabled by the Leader of the House, so the Leader of the House is giving away powers in the order. He seems to be quite happy about that. IPSA will acquire the duty to do all this, rather than the current Leader of the House.

The primary legislation ensures that there is a requirement, though, for IPSA to consult interested parties prior to determining benefits or contributions in future. In the primary legislation interested parties include the Speaker, the trustees of the scheme, the Senior Salaries Review Body, the Government, and in many ways the most important organisation in all pension deliberations—the Government Actuary’s Department. This is all entirely sensible, and I look forward to IPSA undertaking this work in due course.

--- Later in debate ---

[Ms Eagle]

I agree. I certainly hope that the Government want to negotiate in good faith with public sector unions, and I understand that sector-specific talks have been going on. In education there were meetings last Wednesday, in health there are meetings tomorrow, and the civil service has had a few meetings, because on public sector pensions it is hard to generalise. The schemes are quite different, and the local government scheme is funded completely differently.

I understand also that a meeting is due a week today between the Chief Secretary to the Treasury and the Cabinet Office Minister with responsibility for the central talks, and I certainly hope that all sides show flexibility so that there can be a negotiated settlement.

[Mr Winnick]

Does my hon. Friend agree that, after a lifetime working in public service, and with the expectation of a pension somewhere in the region of £5,000, many of our constituents will not accept a reduction because the House has today decided that its pension scheme is going to be different? They would be daft to be so persuaded, and they will not be.

[Ms Eagle]

I do not think that I was making that argument, and I hope that the negotiations will be meaningful and successful.