New Clause 7
Pensions Bill
6:30 pm
Nigel Waterson (Shadow Minister, Work & Pensions; Eastbourne, Conservative)
I beg to move, That the clause be read a Second time.
The new clause is on another big issue, which has been a running sore for some time and a major distraction from the Government’s attempts to restore confidence in the pensions system. It would require the Secretary of State, within three months of the Bill coming into force, to bring forward proposals to comply fully with the recommendations in the ombudsman’s sixth report of 2005-06, “Trusting in the pensions promise: government bodies and the security of final salary occupational pensions”.
One might think it a bit odd that it has been necessary to table such a new clause. After all, the office of the parliamentary ombudsman has existed since the 1960s. It was introduced by a Labour Government, in the shape of Dick Crossman, and it has had cross-party support ever since. It is seen as an important, independent safeguard for the rights of individuals when the Executive bring about maladministration. In her report in March 2006, the ombudsman could not have been clearer. She found that the Government were guilty of maladministration to pension scheme members who lost their money when their schemes collapsed or were closed by their employers. She said that official information about security of final salary occupational schemes
“was sometimes inaccurate, often incomplete, largely inconsistent and therefore potentially misleading”.
However, what did the Government do? First, they rubbished those findings, and then they rejected them in total, mainly by claiming that the cost of providing financial redress, as indicated by the ombudsman, would be too great.
The Prime Minister came up with a figure of £15 billion—he has repeated it more than once since then—and said that that was unaffordable. Since then, the Government have been in denial about the whole matter. The Prime Minister said that
“although of course we must and do treat seriously the ombudsman's findings, we are being asked as a consequence of them to give, on behalf of general taxpayers £15 billion-worth of commitment. We simply cannot do that.”—[Official Report, 15 March 2006; Vol. 443, c. 1450.]
The first major issue—I shall come to financial redress in more detail—is that it is not the job of Ministers and certainly not the job of the Prime Minister, to decide whether there has been maladministration. That has been found, and the message to Ministers is to get over it. The ombudsman made her decision and the whole point of creating the Parliamentary Commissioner for Administration in 1967 was that such decisions were taken away from the Executive. Challenging the findings of the referee, which is effectively what the Government have done, is simply unacceptable and a constitutional outrage, leaving aside the continuing and abiding unfairness to those who have lost out.