Pensions (Special Rules for End of Life) Bill

Laurence Robertson Excerpts

Report stage
Friday 17th May 2024 Commons Chamber

[Dr Coffey]

I am grateful to my hon. Friend the Member for Tewkesbury (Mr Robertson) and to the Government and the Department for Work and Pensions. I have tabled these amendments because, as has been seen with other Bills to which we have given Third Reading, they concern the timing of when an Act comes into effect. I am conscious that there are a number of situations where more work needs to be done to get some of the details and guidance, and other elements like that. Regrettably, for a variety of pieces of legislation, waiting for the Secretary of State to create regulations has somewhat delayed the introduction after Royal Assent of the effect of the Act that so many people have worked hard to achieve.

I am not in any way trying to detract from the regulator or from the Department for Work and Pensions, of which I was proud to be the Secretary of State, but I am particularly conscious about the uncertainty of the timing of a general election. Of course there are still procedures that can be done to some extent, but those who have held ministerial office will know some of the challenges that take place in terms of process, procedure, and different Cabinet committees. Put simply—this is why I am grateful to my hon. Friend and to the Government for listening to my concerns—the amendments would remove extra steps of process. That matters because I am keen to see the Bill enacted. I am not seeking in any way to hold it up. I want certainty about making it happen, and I was concerned about the uncertainty of timing. I was careful to check that the amendments would not affect the legislative consent motion that has already passed the Northern Ireland Assembly. If there is any way that they do, I have not been made aware of that—I have been given the opposite assurance.

I am keen to ensure that the United Kingdom moves together. We have two formally separate systems. These are transferred powers—they have always been powers for the Northern Ireland Executive and Assembly to deal with—but I know that the Executive and the Assembly have been keen, particularly in social security matters, for the United Kingdom to proceed in step so that we do not give different treatment to the same things, especially when we all pay the same tax and we all tend to have the same service providers.

After careful consideration, I wanted to ensure that the Bill becomes law in a timely fashion, without the need for further process, and that is why I will be pressing my amendments.

[Mr Laurence Robertson (Tewkesbury) (Con)]

I thank my right hon. Friend the Member for Suffolk Coastal (Dr Coffey) for tabling her amendments and for discussing them with me over the last few days. We have worked to try to ensure that the best outcome is found. She makes the point that when there is a general election coming, albeit that that is an unusual circumstance—one hopes that it will arise only every five years—it throws things into doubt. The last thing we would want is for the Bill to get Royal Assent and then, for some reason—probably the election—not come into force. I understand where she is coming from on that.

I also thank the Minister and the Government for discussing these issues and coming to an agreement to accept the amendments. I am certainly very happy to accept them. There is no need for me to drag proceedings out any further at this point. I thank all concerned for their work.

[Dame Angela Eagle (Wallasey) (Lab)]

I rise just to seek some reassurance on the amendments. I am not at all against them in principle—when I read them on the amendment paper, I could understand what the right hon. Member for Suffolk Coastal (Dr Coffey) was attempting to do and exactly why—but it strikes me that they rather run roughshod over established procedures, particularly with respect to the devolved Administrations, by giving quite a strict timetable. I wonder whether the Minister could reassure the House. Although it is not the case here, the changes made by Bills can often be quite complex and have to be made appropriately, and putting a very hard stop in a Bill, regardless of context, sets rather a difficult precedent.

Although I do not object to what the right hon. Member for Suffolk Coastal is trying to do, I was slightly surprised by the bulldozer approach that the amendments create. In this circumstance it is manageable, but it might not be quite so manageable in other, more complex circumstances. I suppose I seek some reassurance from the Minister about the precedent that the amendments will set. How wide will it go? Are we going to start including in Bills a precise timetable for when they will be put into effect, with a hard stop, regardless of their complexity?

I understand that the hon. Member for Tewkesbury (Mr Robertson) wants his Bill—we all want this to be done quickly—but there are some precedents being created here that would be slightly worrying if they were to extend more widely. I wonder whether the Minister might give us some thoughts and insights in that respect. I want to make it clear that the Opposition do not object to the Bill at all, but I am quite surprised by the innovative way in which the right hon. Member for Suffolk Coastal has sought to pursue her desire to get this thing done quickly.

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[Mr Robertson]

I beg to move, That the Bill be now read the Third time.

I am pleased that the Bill’s passage through the House has been relatively smooth, so I thank the Government and indeed the Opposition for their support. Although the Bill’s scope is narrow, it will provide financial assurance to those who have received the devastating diagnosis of a terminal illness and who have also seen the sponsors of their pension schemes become insolvent. The Bill will do that by amending the definition of the words “terminally ill”.

When someone receives the awful news that they may have only months to live, it is only right that financial problems should be the least of their worries. The loss of their rightful pension payments should not mean that they must live out their remaining time constrained by their financial circumstances. The Bill aims to address that problem directly.

For wider context, the Bill focuses on the Pension Protection Fund and the financial assistance scheme. The Pension Protection Fund, established by the Pensions Act 2004, pays compensation to individuals when the sponsors of their defined-benefit schemes—usually their employers—become insolvent and lack the necessary assets to pay those pensions to the level that the Pension Protection Fund ordinarily would. That is for cases when such insolvency takes place on or after 6 April 2005. The financial assistance scheme applies to individuals whose pension schemes were unable to meet their pensions liabilities in full when those schemes started to wind up between 1 January 1997 and 5 April 2005. The Bill concerns the compensation payments made to people diagnosed with a terminal illness from those schemes.

The Pension Protection Fund provides a one-off lump sum payment to those who receive such a diagnosis, while the financial assistance scheme will begin to make payments to someone at any age. The issue that the Bill seeks to address is the definition of a terminal illness.

The Pension Protection Fund and the financial assistance scheme both use the same legal definition of terminal illness, which that is that

“a person is ‘terminally ill’ at any time if at that time the person suffers from a progressive disease and the person’s death in consequence of that disease can reasonably be expected within 6 months.”

The same definition was used by the Department for Work and Pensions for the purpose of calculating benefits, but that was reformed in the Social Security (Special Rules for End of Life) Act 2022, where the six-month period included in the definition of “terminally ill” was extended to 12 months. The change in definition for these two pension schemes seems only logical. That would keep the definition consistent with making social security payments.

It is difficult to say how many people will benefit from the Bill, and in reality we do not really want people to benefit as that would mean that the sponsors of their pension funds have become insolvent, which we do not want to see. However, where that is the case, this legislation will benefit terminally ill people.

The Bill’s scope is technically limited to the Pension Protection Fund and the financial assistance scheme, but I hope it will encourage any workplace pension that does not have provision for terminal illness, where the member has a life expectancy of 12 months or less, to consider putting such a scheme into place. Depending on the scheme’s rules, many private pension schemes can already make what are called serious ill health payments under tax law, if the member has up to one year to live. The change will be well worth making.

The heartbreaking job of giving a terminal illness diagnosis falls to health professionals. Modern medicine, surgery, palliative care and the general care provided by our incredible NHS staff make that judgment even more difficult. It is therefore right to extend the definition of terminally ill from the narrow band of six months to the more accommodating threshold of 12 months. That is fairer not only to the ill person but to those who have to make the difficult judgment, especially when those health professionals know that a person’s pension payments may rest on that.

As we just heard, the Bill extends throughout the United Kingdom, and comes into force in England, Scotland and Wales four months after Royal Assent, and likewise in the case of Northern Ireland. I commend it to the House.

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[Mr Robertson]

I am pleased to draw this debate to a close by thanking the Minister and the Opposition for their support, and in particular with regard to setting the date for the commencement of legislation. In that context, I also thank my right hon. Friend the Member for Suffolk Coastal (Dr Coffey) for her amendments. I thank all hon. Members who have spoken in this debate and particularly those who served in the Committee stage. I also extend my thanks to those at the Department for Work and Pensions and the Bill management team, who have been so very helpful, and to the staff at Marie Curie, who were mentioned earlier and who campaigned so strongly on this issue. Hon. Members will know we cannot function in this place without the help of our staff, so I particularly thank my staff, Benjamin Jones and Harry Wallace, for the work they have put in. I hope by working together on this piece of legislation that we will have made a difference.

Question put and agreed to.

Bill accordingly read the Third time and passed.