Clause 99 - Establishment of new public schemes and transfer of rights

Public Service Pensions and Judicial Offices Bill [Lords] – in a Public Bill Committee am 2:00 pm ar 27 Ionawr 2022.

Danfonwch hysbysiad imi am ddadleuon fel hyn

Question proposed, That the clause stand part of the Bill.

Photo of Graham Brady Graham Brady Chair, Conservative Party 1922 Committee

With this it will be convenient to discuss clauses 100 to 103 stand part.

Photo of Simon Clarke Simon Clarke The Chief Secretary to the Treasury

It will be helpful if I can preface my remarks on clause 99 onwards by returning briefly to clause 5 in relation to the question asked by the hon. Member for Glenrothes, because I can now provide some further information about opting into the remedy. The purpose of clause 5 is to rectify any discrimination that may have resulted in members opting out of relevant pension schemes. It is very important that schemes are permitted to require information to be provided by members to establish why they opted out of the relevant pension scheme, as there may be reasons other than discrimination why members have opted out. It is appropriate that schemes have the power, so that they can ensure that the remedy applies for appropriately affected members. The power allows schemes to set conditions in scheme regulations, as schemes will be best able to assess what it is reasonable to expect a member to provide. The consequences of opting back into the pension schemes are very significant for members’ pension rights and therefore it is important that schemes can take decisions under clause 5 while in possession of relevant information. To help to ensure consistency, scheme regulations are generally subject to Treasury consent, which will ensure fairness.

Clauses 99 to 103 will allow the Treasury to make regulations that establish new public pension schemes for the members of the Bradford & Bingley staff and NRAM pension schemes. Those schemes currently reside under UK Asset Resolution, the holding company responsible for the Government’s remaining interests in those companies. The provisions also include protections that will ensure that members’ rights to pensions and other benefits are at least as good following their transfer to the new public schemes, and set out requirements to ensure that members are protected in the event of future changes to the scheme rules. These clauses will further allow the Treasury to make regulations transferring the assets and liabilities of the current schemes to a nominee of the Treasury, or a company established by the Treasury, for their disposal.

Establishing the new schemes will accelerate the timeline for UKAR to be wound up, helping to relieve the taxpayer of the cost of UKAR’s ongoing operations, and create a more efficient structure for the Government to meet their liabilities towards the scheme members.

Photo of Tulip Siddiq Tulip Siddiq Shadow Minister (Treasury)

The Government have yet to set out the estimated costs of the provisions for Bradford & Bingley and Northern Rock and whether those costs are in addition to the £17 billion budgeted for the McCloud response or are part of the same overall costs. I would be grateful if the Minister could provide some clarity on that matter.

Photo of Simon Clarke Simon Clarke The Chief Secretary to the Treasury

To be clear, the measures affecting Bradford & Bingley and NRAM are net cost savings, so this is a net benefit for the Exchequer; it actually reduces costs.

Question put and agreed to.

Clause 99 accordingly ordered to stand part of the Bill.

Clauses 100 to 103 ordered to stand part of the Bill.