Pension Schemes Bill

Debate between Peter Swallow and Vikki Slade

Report stage
Wednesday 3rd December 2025 Commons Chamber

[Vikki Slade]

I thank my right hon. Friend for his intervention—he has stolen my next line.

John, who works at the BP depot at Wytch Farm, which is the largest onshore oil site in England in Poole harbour, told me that his pension has been eroded by 11%—he probably got the same letter as my right hon. Friend’s constituents. Even modest requests for discretionary increases made by the trustees have been refused by the parent company. Those discretionary increases were affordable; they would not have required any additional funds from the company. Another of my constituents, Suzie, who sits on the steering group, told me that the issue affects 56,000 pensioners from BP alone, but the change—a small one—would support pensioners from many other companies.

I will end by talking to new clause 3, tabled by my hon. Friend the Member for Stratford-on-Avon (Manuela Perteghella). I do so in memory of my mum Lin Foster, who died before she could access her pensions, and in support of my constituent Judith, who came to see me about her sister Alison, who died after receiving a terminal brain tumour diagnosis. Alison found that the paperwork required to access her lump sum meant that she would have to articulate and confront her impending death—something that she simply could not do on top of everything else. It meant that, as a result, she missed out on funds that could have made her last few months more bearable, as well as on potentially accessing treatments that might have given her a bit more time with her family. This simple clause would have allowed her medical team to make that declaration on her behalf via an SR1 and to reduce the administration for all concerned.

The Bill goes a long way in improving the lives of pensioners, but for the pensioners who are missing out, small changes could make a huge difference. I urge Ministers to think about the impact they could have on lives by little tweaks that will not cost the Government anything, or very much, at all.

[Peter Swallow]

Can I say at the outset how much I have enjoyed the debate? I particularly want to highlight the contributions of my hon. Friend the Member for Llanelli (Dame Nia Griffith), who powerfully raised some of the issues that I will go on to address, and—purely because I enjoyed the fiscal geekery—the contribution from the hon. Member for Aberdeen North (Kirsty Blackman), who rivals the Minister himself in her enthusiasm for financial issues. What a delight it was to experience that.

I welcome the opportunity to speak on this Bill, which touches on several issues close to my constituents in Bracknell Forest. It is also worth acknowledging the strong action that the Chancellor took in the Budget to support all pensioners by raising the state pension by up to £550. That is possible only thanks to Labour’s steadfast commitment to the triple lock on pensions. That is real action on pensioner poverty, at a time when the Conservatives and Reform have flirted with scrapping the triple lock.

Similarly, the Bill delivers real benefits to private pension savers across the country by simplifying and streamlining the system. The measures will increase their returns—around 3,300,000 workers on defined contribution schemes in the south-east alone stand to benefit by about £29,000 more for their retirement—while helping to unlock around £50 billion of investment in the UK economy. Hon. Members need only follow the Minister on Twitter to see why it is so important that we increase investment in the UK economy after many years of under-investment by the previous Government.

I thank the Minister for the work to get the Bill to this stage. I welcome in particular the measures providing for action on an issue close to the hearts of many in Bracknell Forest: the slow erosion of pre-1997 defined benefit pensions. It is for that reason that I will focus on new clause 22, which calls for the indexation of pre-1997 pensions. I sympathise deeply with the spirit of the new clause. The erosion of those pensions is an injustice—one that urgently needs addressing. It is important to say that not all pre-1997 schemes are in surplus. Although I agree that that is not the fault of their members, legislating to index would put entire schemes at risk, and I believe that that is not a risk that any sensible Government would take. However, it is vital that the Bill marks the beginning of further action to bring justice to those with pre-1997 defined benefit pensions whose schemes are now in generous surplus.

I was delighted when the Chancellor announced at the Budget statement that members of the Pension Protection Fund will have their accruals protected from inflation, ending years of degradation. That has been carried through in amendments before us. I welcome the recognition in principle that those with pre-1997 pensions are indeed facing an injustice, and that action must be taken to rectify it. I have met many constituents who were formerly employed by HP and later HPE, which used to be based in Bracknell. They are now members of the HPE pension scheme, and have seen their returns decimated. I have spoken with other pensioners in other schemes, too—many of which have been mentioned by others Members across the House. It is not right that people who have worked hard and paid into their pensions now face ever-diminishing life savings through no fault of their own, despite many schemes, including HPE, having significant reserves.

One of my constituents, Ed, began drawing from his pension nine years ago. In that time, his pension has increased only three times, by three separate percentage increments: 3%, 1%, and 1%. He says that, had his pension risen in line with inflation, he would have seen his pension increase by around 38% over the years to 2025. As a result—this is the real-life impact—he has seen a dramatic fall in his living standards. Ed is not alone. Constituents in Bracknell and across the country should not have to fight any more to make themselves heard and achieve justice.

This is an opportune moment to do what we can to put that right. In the Bill, the Government are reforming the use of surpluses, rightly strengthening the hands of trustees to act, as the Government themselves have done for the PPF scheme, for which they effectively act as the trustee—they are leading by example. I thank the Chancellor and the Pensions Minister for meeting me to discuss that before the Budget. The Minister has been clear on his expectations of trustees following the passage of the Bill, including in his contribution today, and I thank him for his comments, specifically on strengthening guidance for trustees.

Today must be the beginning, not the end, of the story. I have written to the trustees of the HPE scheme urging them to use the powers in this Bill to right the wrong.

I wanted to take this opportunity to call once more on the trustees of the HPE scheme, and other schemes similarly in surplus, to do everything in their power to ensure that pre-1997 pensions are protected from inflation, and I wanted to do so on the Floor of this House because I think it important that we are as clear as possible that trustees will be given the powers they need to act and should follow through with concrete action to protect pensions. That is the right thing to do, and with the powers the Government are granting in the Bill, it is now in their hands to do it.