Pension Schemes Bill [Lords]

Mhairi Black Excerpts

Wednesday 22nd March 2017 Commons Chamber

These new clauses would help to deal with the current issue facing plumbers in Scotland. Plumbing Pensions (UK) Ltd was established in 1975 to provide pensions for the plumbing and heating industry UK-wide. The scheme is managed by a group of trustee directors appointed from nominees of the Association of Plumbing and Heating Contractors in England and Wales, the Scottish and Northern Ireland Plumbing Employers Federation, and Unite the union. The scheme has over 36,000 members and assets in excess of £1.5 billion. Under section 75 of the Pensions Act 1995, employers can in certain circumstances become liable for what is known as a section 75 employer debt. The debt is calculated on a “buy-out” basis, which tests whether there would be sufficient assets in the scheme to secure all the members’ benefits by buying annuity contracts from an insurance company. Legislation specifies that a section 75 employer debt becomes payable when the employer either becomes insolvent, winds up, changes its legal status, or ceases to have any active members in the scheme. While we must be mindful that the purpose of these rules is to protect pension benefits, the way in which they are currently framed creates problems for some stakeholders. We are sympathetic to the concerns raised by SNIPEF.

[Mhairi Black (Paisley and Renfrewshire South) (SNP)]

Does my hon. Friend agree that it is because of such examples as he has touched on of unincorporated businesses at risk of losing personal assets that it is so pertinent that the Government bring forward the solution right now rather than wait for the opportunity to pass?

[Ian Blackford]

I am grateful to my hon. Friend, who is absolutely right. These are complex issues. That is why we make the suggestion that we are willing to work with the Government on this. We have to find a solution to this because at the end of the day ordinary people who have done the right thing could now be faced with losing their house, and that cannot be right. This issue has to be resolved.

There are a number of options for the UK Government to consider but each one has complications for the pension schemes, employers and scheme members. We urge the Government to weigh up the interests of employers with the need to protect benefits for pension scheme members. The former Pensions Minister in the other place, Baroness Altmann, indicated that she would look closely at how a solution could be reached to this complex issue. We need the same assurances from the Minister that he will work to find a solution for the industry and use this Bill to bring forward a solution.

SNIPEF’s four objectives are to achieve an amendment to section 75 debt legislation, as its main concern is for those involved in the unincorporated businesses that my hon. Friend mentioned who are at risk of losing their personal assets including their homes. It wants the Government to conduct a review of the actuarial methods used to value pension scheme liabilities, as it believes that the calculation of section 75 employer debt on a full annuity buyout basis is inappropriate and detrimental to non-associated multi-employer schemes given current economic conditions. It argues that orphan debt in any non-associated multi-employer scheme should be excluded from the calculation of section 75 employer debt. It suggests that provided the scheme is deemed to be prudently funded, the PPF acts as guarantor of last resort for orphan liabilities. It also believes that any changes in legislation should apply retrospectively to all employers from 2005. It would be helpful to get the Government’s view on this request. SNIPEF recently met the Minister, and it has advised SNP MPs that he confirmed that the objectives may have been incorporated within the Green Paper. We are now interested to hear the Government’s view as to whether they have identified a solution.

I want briefly to make passing reference to my two new clauses that have not been selected for debate, and signal my disappointment about that. New clause 10 would require the Secretary of State to identify support for women affected by the changes to the timetable for state pension age equalisation. We are disappointed that a pensions Bill has not been brought forward to deal with the pressing injustices within the pensions system.

[Mhairi Black]

Does my hon. Friend agree that by missing this opportunity the Government are wilfully ignoring it, much like they are ignoring the WASPI women themselves?

[Mr Deputy Speaker (Mr Lindsay Hoyle)]

Order. We do not discuss new clauses that have not been selected. We have to deal with what is before us and that is the new clauses on the selection list. I know that the hon. Gentleman wants to stay in order by dealing with those, not those that have been omitted.