Clause 53

Part of Pensions Bill – in a Public Bill Committee at 2:30 pm on 31st January 2008.

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Photo of Mike O'Brien Mike O'Brien Minister of State (Pension Reform), Department for Work and Pensions 2:30 pm, 31st January 2008

Clause 18 says

“the employer’s contribution must be at least 3% of the amount of the jobholder’s qualifying earnings in the pay reference period.”

It is in the Bill already. I am not sure there is any point in putting it into this clause. It might confuse the courts, who may think there is some other further point.

We cannot accept the amendment proposed by the Conservatives, on the basis that it makes 3 per cent. the contribution; we have always made it clear that we regard it as a minimum contribution. We expect many employers will want to make a contribution higher than 3 per cent. We think that is a matter for them. That is why we have worded clause 18 in the way we did, saying that the employer’s contribution must be at least 3 per cent. of the amount of the jobholder’s qualifying earnings. I cannot see any point in putting it here.

I thought the Conservatives had taken a view that the employer’s contribution should be held at 3 per cent. which somewhat surprised me. I see now that that was not the intention—so that is clearer—but I do not see any point in putting it in twice. I can see a point in not doing it, in that the courts might want to know why it was there twice and whether this meant something slightly different. I am not convinced of the argument and do not see why this is necessary. I regret I cannot accept the amendment.