Pension Schemes (Conversion of Guaranteed Minimum Pensions) Bill - Second Reading

Part of the debate – in the House of Lords at 10:37 am on 25 March 2022.

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Photo of Baroness Wheatcroft Baroness Wheatcroft Crossbench 10:37, 25 March 2022

My Lords, I welcome the Bill and thank the noble Baroness, Lady Redfern, for introducing it. As a pensions amateur sandwiched between two pensions professionals—the noble Lord, Lord Davies, and the noble Baroness, Lady Drake—I will keep my remarks brief.

I wanted to speak about the Bill because it is about equalities, and I like equalities that work both ways: not just treating women equally but, on the occasions when they should be levelled up, treating men equally to women. It is not often that we have the opportunity to do that, but in this Bill we do. As the noble Baroness, Lady Redfern, pointed out, nobody will lose as a result of the Bill. People will only gain, and that is to be welcomed.

However, I have questions. The legislation that gives rise to this—the need for equal treatment—came about in 1990. It is fair to ask why it has taken quite so long to get to this position. During that period, there has been a question mark over survivor benefits which this Bill now finally seeks to deal with, but one of the important things about pensions is that there should be a degree of certainty. As people plan for retirement and old age, it is imperative that they be able to look ahead and see what their income might be. I am told that this Bill affects millions of people. As a result of this, they will still not be able to look at what their future pension is and plan for it.

So I ask the Minister whether there is a way in which a deadline could have been imposed to make it clearer for people, so that they can have some idea now of the effect that equalisation will have on the pension they are looking forward to—or should it remain that pension schemes just wait and wait, leaving people in limbo, unable to plan for their future?

Many times, as she introduced the Bill, the noble Baroness referred to how complex it is. That is true: you only have to look at it; it is a small Bill, but it is certainly not simple. So finally, I make a plea—I am not alone in this, and it has been done many times—for simplification of pensions. How can people look ahead and plan if the legislation is so complicated that even the professionals cannot make sense of it? Many pension professionals still scratch their heads about how the lifetime limit, for instance, will impact people, and we have seen how the tax issue can cause all sorts of unwanted anomalies to pensions. My final plea to the Minister is to please look at pensions simplification, and perhaps a little more effectively than we did with tax simplification.