AEA Pension Scheme

Paul Monaghan Excerpts

Wednesday 26th October 2016 Westminster Hall

[Dr Paul Monaghan (Caithness, Sutherland and Easter Ross) (SNP)]

I congratulate the right hon. Member for West Dorset (Sir Oliver Letwin) on winning this debate. He has provided a detailed analysis of the issues impacting on the lives of many people in Scotland and elsewhere who are AEA Technology pension scheme members.

We know that AEA Technology was formed in 1996 as a privatised offshoot of the UK Atomic Energy Authority. Crucially, we also know that the Atomic Energy Authority Act 1995 detailed the conditions for AEAT’s creation, including specific provision for the pension arrangements of transferring staff. Those specific arrangements included a statutory reassurance and statutory duty to provide a pension scheme that was “no less favourable” than the UKAEA scheme. In November 1996, the Government Actuary’s Department issued a note outlining the choices available to members of the UKAEA scheme: to leave their preserved benefits in the UKAEA pension scheme, which as we have heard was a public service pension scheme; to transfer them to the AEAT scheme; or to purchase a personal pension. According to evidence submitted to the Pensions Ombudsman Service, the Government Actuary’s Department not only highlighted the three options that I have just noted, but specifically stated at the time that it was unlikely that

“the benefit promise made by either the UKAEA scheme or the AEAT scheme would ever be broken.”

Sadly, the companies that made up the AEA Technology group did fail and went into administration in November 2012. At that time, the AEAT pension scheme entered a Pension Protection Fund assessment period. The PPF was set up under the Pensions Act 2004 to provide compensation to members of defined-benefit pension schemes that wind up underfunded on the insolvency of the employer. Unsurprisingly, because of all this, AEA Technology pension scheme members now feel very aggrieved and misled by the advice that they were given by the UK Government.

It is clear that the UK Government are now abrogating their responsibilities towards the AEA Technology pension scheme members. It is equally clear that the circumstances surrounding the information provided by the Government Actuary’s Department at the time of the transfer, or the lack thereof, warrant thorough investigation in the light of AEA Technology being unable to meet its commitments. That could perhaps be undertaken by the ombudsman, as suggested by the right hon. Member for West Dorset.

Sadly, this affair is another in a long line of pension crises facing UK taxpayers in the last few years. They range from BHS, through the Scottish and Northern Ireland Plumbing Employers’ Federation and the civil nuclear constabulary, to the Women Against State Pension Inequality campaign and more. Indeed, many people affected by the AEA pension scandal are also affected by the arbitrary changes in the retirement age. That is a completely different take on the “pensions triple lock” of which the UK Government have boasted.

It would be helpful and honest for the UK Government to reinstate AEA Technology pension rights as promised by the Government at the time of privatisation and to launch immediately a thorough investigation into the pre-pack insolvency of AEA Technology that will scrutinise the roles of interested parties, including the Pensions Regulator, the PPF and the trustees. Pensions are a contract, not a benefit. Those who pay in deserve to receive their promised entitlement, and it is the responsibility of the UK Government to secure that entitlement and provide dignity in retirement to AEA Technology scheme members.

Universal Basic Income

Paul Monaghan Excerpts

Wednesday 14th September 2016 Westminster Hall

[Ronnie Cowan]

As I said at the very start of my speech, there are many and varied approaches to this issue; no one has worked up the complete solution at this stage. What we are aiming for is acknowledgement of the fact that our current system is not fit for purpose, and the people of the United Kingdom should be looking for “best of breed”. If we are not prepared to take on that challenge, then we are not in the right job.

[Dr Paul Monaghan (Caithness, Sutherland and Easter Ross) (SNP)]

I congratulate my hon. Friend on securing this important debate. Does he agree with me that his proposal for a universal basic income has the potential to eradicate poverty, to make work pay and to ensure that all citizens can live in dignity, which does not happen today?

[Ronnie Cowan]

Absolutely. The aims of this approach are laudable ones and are not something that we, as representatives of the people, should turn our back on.

As a general definition, a universal basic income would be an unconditional basic income given to each individual irrespective of their other income. At this stage, everything else needs to be defined, including what proportion of the welfare system would be replaced by a UBI. We should be sincere in our approach to this issue by saying that its successful implementation would require a revolutionary shift in attitudes towards social security.

--- Later in debate ---

[Damian Hinds]

I do not know where to go with that. I am not sure that it is true that the money is there; in fact, I am confident that it is not. In this country, the only way in which we raise money for public expenditure is through taxation on individuals, companies and other activities.

[Dr Paul Monaghan]

Everyone watching the debate will be interested if the Minister can tell us which of those initiatives that my hon. Friend the Member for Inverclyde (Ronnie Cowan) cited cannot be afforded by the UK Government?

--- Later in debate ---

[Damian Hinds]

Helping people on relatively low incomes to increase their incomes by moving up the hours scale or the earnings scale is of course an objective that the hon. Lady and I share. That is why we have made the childcare reforms that I alluded to and brought in the national living wage, which will affect people who were previously on the national minimum wage but will also have a ripple effect on pay grades immediately above that. The critical thing, which we come back to time and again, is that universal credit will reform the system, in which there are certain cut-off points on the hours scale, to ensure that there is as smooth as possible a transition through work.

The hon. Member for Brighton, Pavilion talked about less secure employment. It is certainly true that today’s labour market differs in several ways from the labour market of the 1960s and 1970s. Several factors are at play, including the long-term shift to the service sector and the fact that people are living longer. Yes, it is also true that people are much less likely to stay in a job or work for one employer or even in one sector for their entire careers, but it is important to note that three-quarters of the increase in employment since 2010 has been in full-time work. Only around 14% of people in part-time work would prefer to be working full time, although obviously we want to increase the opportunities for them.

Relatively few people in the economy rely on zero-hours contracts, which give people on average around 25 hours of work per week. We know from surveys that most people on zero-hours contracts are not seeking to increase their hours. Although those types of contracts clearly are not even close to being suitable for everyone, there are some people for whom they work. A lot of people on zero-hours contracts are students or people coming back into the labour market, and such contracts can be a good way in. It is absolutely right for the Government to have banned exclusivity clauses that prevent people from taking up other work.

[Dr Paul Monaghan]

Will the Minister give way?

[Damian Hinds]

Will the hon. Gentleman forgive me if I press on? The extremely important point of technological change was raised, and that needs to be debated in the House and elsewhere. Some proponents of a universal basic income cite the inevitable changes in the world of work, driven by technological advance and artificial intelligence, which they believe will make many jobs obsolete and increase unemployment. That argument has a long pedigree, which goes back beyond the spinning jenny, and I do not at all belittle the importance of that discussion or the implications of structural change. We must of course be sensitive to such possibilities, but time and again over the decades, as technological change has removed the need for one type of work, it has created another.

In conclusion, although a universal basic income may appear to be desirable at first glance, any practical implementation would, I am afraid, be unaffordable. Because UBI does not properly take into account individual needs, it would markedly increase inequality. Universal credit is the right system for the United Kingdom. This responsible Government are implementing a system that encourages work, supports the most vulnerable and is affordable.

Budget Resolutions and Economic Situation

Paul Monaghan Excerpts

Thursday 9th July 2015 Commons Chamber

[Dr Paul Monaghan (Caithness, Sutherland and Easter Ross) (SNP)]

Thank you, Madam Deputy Speaker, for giving me an opportunity to contribute to the Budget debate.

As we heard from my hon. Friend the Member for Berwickshire, Roxburgh and Selkirk (Calum Kerr), history is important. We can learn much by studying the social and economic conditions of the past, and my constituency holds many lessons that are relevant today, for I represent the part of Scotland that endured the clearances. Indeed, it would be remiss of me if I did not begin my speech by paying tribute to the remarkable families, and the crofters, who lost their livelihoods, their homes and their lives during that shameful period of history.

The clearances were perpetrated during the 18th and 19th centuries when highlanders were forced from land they had held for generations. The clearances shifted land use from farming to sheep raising because sheep were considered more valuable than people. In the process, a way of life was exterminated to further the financial ambitions of aristocratic landowners. The evictions that took place are remembered for their brutality and for the abruptness of the social change that they prompted. At the time this Parliament compounded the inequity by implementing legislation to prohibit the use of the Gaelic language, the playing of bagpipes and even the wearing of tartan. The cumulative effect devastated the cultural landscape of the counties that I represent and the resulting impact destroyed much of Scotland’s Gaelic culture.

This Parliament’s policy ultimately failed, although I suspect that the Chagos islanders would recognise this account. In those dark days the cries and pleas of innocent families were ignored. If they were lucky, those families were dragged screaming from their homes, evicted and left to face destitution. If they were unlucky, their homes were simply set alight as they sat within them. The clearances forced the migration of highlanders to the sea coast, the Scottish lowlands, and further afield to the new worlds of north America and Australasia. Today more descendants of highlanders are found in those diaspora nations than in Scotland itself. These dispossessed highlanders travelled the world and applied their creativity and resource in ways that have benefited all of humankind. The economic and social contribution of the ancestors of people from my constituency stand today as a shining example of why the free movement of people is something no Government should hesitate to encourage.

As we debate the Government’s Budget, it is unfortunate that the cries and pleas of many people in my constituency continue to be ignored. Whereas in history the people of the highlands were burned out of their homes so that others could profit from sheep, the beneficiary of this Budget will be the financial markets that continue to take precedence over people. The impact will be that vulnerable people will face impoverishment owing to lack of economic opportunity, low wages, Europe’s lowest pensions, further experimentation with the failed system that we know as universal credit, the erosion of working tax credits and, frankly, the stifling lack of imagination that is self-evident in the austerity these measures promote, and that has raised the UK to be the fourth most unequal society in the developed world in terms of wealth inequality. For many in my constituency, past and present, the hardship, misery and impoverishment that accompany this inequality are the only consequences of the Government’s long-term economic plan that has been over 300 years in the making.

While some here today speak of economic laws, I choose to highlight the fact that many of our fellows are starving. It is time we recognised that economic laws are made not by nature, but by human beings. These laws are chosen for implementation by human beings and their effect will be felt by human beings. A further £12 billion of cuts, accompanied by a punitive sanctions regime, will do nothing except ensure that the jeely piece, of which my hon. Friend the Member for Glasgow South (Stewart McDonald) spoke in his maiden speech, will remain a significant feature of childhood for far too many of our children.

Until 8 May my constituency was a Liberal stronghold. As long ago as 1918 the seat of Caithness and Sutherland was held by Sir Robert Leicester Harmsworth, Baronet of Moray Lodge in the Royal Borough of Kensington. I don’t think he was a local. Later the seat was held for many years by Robert Maclennan, who sits now as Baron Maclennan of Rogart just a short walk away, and more recently by the 3rd Viscount Thurso, John Archibald Sinclair, the fifth generation of the Sinclair family to represent Caithness in this Parliament. I pay tribute to Lord Thurso. In the past few weeks I have learned that he was a popular member of the establishment here at Westminster and I wish him well for the future.

I have lived in the highlands of Scotland for the greater part of my life and I can confirm that Caithness, Sutherland and Easter Ross is one of the very largest parliamentary constituencies by area and, despite what many of my colleagues will claim, it is easily the most beautiful—spectacularly so. It is a great honour for me to represent a highland seat in this Parliament. It seems clear that in my constituency at least, few ordinary people have had that privilege.

Beautiful as my constituency is, it is subject to great acts of vandalism. Cape Wrath is the only site in Europe where live 1,000 lb bombs are dropped. The bombing is enormously destructive to fragile wildlife and excludes communities from the proximity for up to 120 days each year. Similarly, Scotland’s oldest royal burgh, Tain, is tormented by fast jets flying as low as 150 feet to drop 1,000 lb concrete bombs just a few miles from housing estates and primary schools. It is instructive that while many of my constituents work tirelessly to protect our marine animals, our rivers, our wildlife and our environment, this Government consider it acceptable to bomb the land that we consider precious. I say instructive because this seems to be the manifestation of the one nation ideal that my hon. Friends and I are expected to be impressed by, but from which communities in my constituency derive only disadvantage.

I have spent much of my adult life in the voluntary sector, working with those cruelly challenged by the UK Government’s long-term economic plan. Like others, my family and I pay the punitive electricity charges and excessive carriage charges that this Government impose. We are exposed to the reform of rural fuel duties that has brought a new and vital meaning to the word “failure”. My communities prepare for the disastrous repercussions of the recent announcement of the closure of three Royal Bank of Scotland branches in our rural areas, and our businesses endure the iniquitous transmission charging regime maintained by this Government, which acts as the main obstacle to securing energy supplies and wealth for Scotland.

We are used to empty promises, but in the early days of this Parliament, Scotland has chosen to watch as the promises of something

“as close to a federal state as possible”,

where

“all the options of devolution are there and are possible,”

are publicly erased from the Scotland Bill. The Government know that for many, this Budget visits hardship on disadvantage.

Like my hon. Friend the Member for Inverclyde (Ronnie Cowan), I grew up fascinated and inspired not just by the technological achievements of Project Apollo, but by the social achievements of the civil rights movement. As a child I learned of the bravery of Rosa Parks and how she changed the world, and as an adult I learned of the personal challenges met and overcome by, and of the uncommon political imagination of, Franklin Delano Roosevelt. In those individuals I found examples not only of bravery but of imagination: the imagination to perceive the benefit of change in a world that aspires to achieve, not receive.

Many of those who supported me on 7 May did so in the belief that it is now time to achieve, and their uncommon political imagination sits around me today. Our aim is to achieve the right to build a fairer Scotland; we aim to establish a state of affairs where our old, our disadvantaged and our vulnerable are valued, and where our poor are protected not punished.

I made the decision to stand for election to this Parliament knowing, as Mrs Parks did, that

“I had the strength of my ancestors with me”,

and I know, as you do, Madam Deputy Speaker, that “all are equal”. Indeed, I stand here today knowing, as Mr Roosevelt did, that the

“test of our progress is not whether we add more to the abundance of those who have much, it is whether we provide enough for those who have little”.

In that task we will not be found wanting for, like Roosevelt:

“We are going to make a country in which no one is left out.”

[Several hon. Members]

rose—