Clause 3 - Accrued rights

Part of Armed Forces(Pensions and Compensation) Bill – in a Public Bill Committee at 4:45 pm on 10th February 2004.

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Photo of Mr Ivor Caplin Mr Ivor Caplin Parliamentary Under-Secretary, Ministry of Defence 4:45 pm, 10th February 2004

For a moment, I expected an influx of comments from Opposition Members. It might help if I explain the purpose of the clause before dealing with the amendment. That may sound a strange way of doing things, but I hope that it will help the Committee.

This is a standard clause, designed to protect the interests of current members of the pension scheme from any changes to its rules that may have an adverse impact on their accrued rights. I assure the Committee that I do not foresee any circumstances in which the Ministry of Defence would want to change the conditions of the scheme retrospectively to take away current members' accrued rights, thus leaving them worse off. The clause should reassure hon. Members that if we ever wanted to do that, we would have to obtain the consent of scheme members.

It is worth explaining that in the context of other legislation. Section 67 of the Pensions Act 1995—I do not suggest that the hon. Gentleman has it at his fingertips—protects members of private sector occupational pension schemes from modifications to the scheme rules that would adversely affect their accrued rights. There is similar provision for public service schemes in the legislation governing those schemes, but the armed forces do not have that express statutory protection. The clause is intended to confer that protection on the armed forces pension scheme and is based on the model in section 67 of the 1995 Act. I hope that that is clear.