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I welcome in advance my noble friend’s contribution to the Green Paper that is about to be launched.
The noble Baroness, Lady Hollis, with her background in this area raised a number of points. I think I have nine pages of briefing to deal with all her points; I hope she will understand if I do not go through all of them. She raised a serious point about those on zero-hours contracts, who may have a number of jobs and fall out of the system. There is a wide gateway at the moment to national insurance cover, with the lower earnings limit, and the threshold for access to contributory benefits, including the state pension, is set at the equivalent of less than 16 hours per week at the national living wage. Having made some inquiries as a result of the noble Baroness’s intervention, there is no evidence that this is a growing problem. The number of women working in two or more jobs has hardly changed in the last 10 years—it is around 5% of those in work—and there is always the option of buying into the national insurance scheme if, for whatever reason, you are outside it.
A number of noble Lords raised WASPI. I am only sorry that I cannot be more forthcoming on this than Ministers have been in the past. As your Lordships will know, during the passage of the Pensions Act 2011 a concession was made which slowed down the increase of the state pension age for women so that no one would face an increase of more than 18 months, compared to the increase as part of the Pensions Act 1995. To help older women remain in work, we have abolished the default retirement age and extended the right to request flexible retiring to all employees.
The noble Baroness, Lady Hollis, also raised an interesting proposition about merging ISAs on the one hand and pensions on the other. This is a very radical proposal, as ISAs and pensions have different regimes and objectives. I will need to think about that very radical proposal, with all its implications. Perhaps a debate might take place in the first instance within the Labour Party, to see whether it might mature in that environment. She implied, as others did, that one could not trust people with their pensions. I hope no one wants go back to the old days of having to take out an annuity. My noble friend Lady Altmann made the case for enfranchising people and trusting them to act sensibly with the freedoms that we have given them.
My noble friend Lady Altmann also reminded us of her record in campaigning for reform. As I said, we are very grateful for the offspring, which we are debating today. She mentioned the importance of protecting pension pots from raids. She is quite right that at the moment a pension pot could be raided for wind-up costs. As of the date of publication, assuming the Bill becomes an Act, there is protection. There is also protection from an increase in the percentage taken in charges.
A number of noble Lords asked about the interrelationship between the voluntary framework master trusts have adopted and the statutory framework we are introducing in the Bill. The Bill goes further than the framework of master trusts; it builds on it and builds in added protections. As my noble friend Lord Naseby said, the association of master trusts has welcomed the Bill, which implies that master trusts are able to come to terms with the extra measures they will have to take if they are to be authorised.
Perhaps I may skip over decumulation-only schemes and multi-employer schemes and deal with them in Committee.
My noble friend Lady Altmann asked whether the 1% cap on early exit charges will be confirmed. We are currently considering the level of the cap for occupational schemes as part of our response to public consultation on early exit charges. We intend to publish the response in the coming weeks. My noble friend asked some highly technical questions about definitions, which we can perhaps come to in Committee. She and other noble Lords asked about cold calling and scams. I understand that there will be an announcement in a few weeks’ time. At this stage, I can say no more than that, but I hope it will meet the expectations that have been aroused during this debate.
The noble Lord, Lord Monks, made an interesting point, which I had not expected to hear to from the Benches opposite, about whether NEST, a publicly promoted scheme, is unfair competition to the private sector. It is a good point. NEST is a critical partner in the successful implementation of automatic enrolment. In particular, it is playing a key role in supporting small and micro employers to meet their automatic enrolment responsibilities. It is unique in having a public service obligation. What the noble Lord, Lord Monks, said about the need to build a consensus, the need to move incrementally and the need to win public support for the reforms was spot on.
There was an interesting suggestion about whether there should be a new contribution basis for the low paid of a certain amount per pound rather than a threshold. That is also something I would like to think about.
My noble friend Lady Wheatcroft reminded us of the size of the pot people need to put on one side to cater for their old age and welcomed the impact the Bill will have on protecting the brand of master trusts and ensuring confidence in it. She asked about consolidation. I suspect consolidation is likely. Whether the regulator has a proactive role in promoting it, I am not sure. As implementation comes in in 2018 and a number of master trusts look at the authorisation process, it may well be that they decide to merge with others.
My noble friend also mentioned trustees and asked whether they should have greater powers in the event of a takeover. She will know that the DWP Select Committee is conducting an inquiry into this. We are determined that the regulator should have the powers needed, and if legislation is needed, we will legislate.
I apologise for any discourtesy in curtailing my remarks. My noble friend Lord Flight asked whether there will be an ongoing assessment of financial sustainability. Yes, there will. The noble Baroness, Lady Drake, made a number of very detailed and valuable points, which I look forward to addressing in Committee.
There were concerns about the robustness of the Bill due to its reliance on secondary legislation. I hope we have got the balance right. We have put as much as we can in the Bill—all the key elements of the scheme—and left the details to secondary legislation. I welcome what the noble Lord, Lord Hunt, said about the Bill and building trust and confidence.
The Bill builds on the radical changes made to the pension system over the past 10 years. We need to ensure that savers can be confident that their savings are being well managed. The measures in the Bill will help to protect them and to maintain their confidence. I thank all noble Lords for their contributions, and I invite the House to give the Bill a Second Reading.
Bill read a second time and committed to a Committee of the Whole House.