Pensions Bill

moved Amendment No. 4: 4: Clause 5, page 6, line 22, at end insert— ““( ) For the purposes of any review under subsection (1), the Secretary of State shall take into account the effect of the possible future payment of a basic state pension upon the basis of residency in the United Kingdom, using the relevant data stored under the provisions of section (Record keeping for future payment on residency basis).”” The noble Baroness said: My Lords, in speaking to Amendment No. 4 I shall speak also to Amendment No. 6, which is the more substantive one. Having already trespassed on the generosity of the House, I will not seek to press the amendment to a vote. However, the issue it raises is important and I wish to go round the track once more and then call it a day, at least for this Bill. This is a very modest, nil-cost amendment, which is about future-proofing as far as we can. We have a contributory system for the BSP which Governments of all parties have tweaked, patched and twiddled with over the years in order to bring as many people as possible within it. Today, as a result of your Lordships’ support, we have, I hope, finally got a contributory system which is more inclusive than it otherwise could conceivably have been. However, although we will, I hope, end up with a comprehensive contributory system, it remains complex and obscure. I was very struck by the comments of the noble Lord, Lord Dearing, on the previous debate about just how complex he found the system. I defy most people to know what they are and are not entitled to at any stage because of the complexity of the system, however good the intentions behind it. The Government believe—and I hope that they are right—that in the next couple of decades, 90 per cent to 95 per cent of the population will be drawing a full basic state pension. By then, a Government who are radical, enlightened and far-seeing may decide that we should clean up this untidy, ramshackle process, which has accreted over the years, and have a basic state pension based on residence. They may or may not. But to do so, there needs to be a record of residence—a database—and we must start building it before we need to employ it. As the noble Lord, Lord Turner, said in his report, if that is the path we are going down, we have to have a lead-in time in which to build up a database so that Manuel from Spain who is here for two years does not automatically qualify. A future Government may not wish to change the structure but if they do, they will find it very difficult unless a previous Government had kept their options open for them. One of the lessons we have learnt from pensions legislation over the past years is that we are rather good at dealing with problems when they have emerged but rather bad at anticipating where problems will emerge—in other words, future-proofing our legislation. The amendment would simply keep options open for a future Government. It does not commit that Government to doing anything but it would allow them to make a decision with the information they needed which otherwise they would not have. The amendment seeks to build a residence database. Is it straightforward? I think so. We already have a pretty good database in the electoral roll. Some 97 per cent to 98 per cent of working-age adults who have not moved house in the past year are on that roll, and local authorities are already required to retain that roll for 15 years. Records could be cross-checked with council tax rolls and even, down the line, with the proposed identity cards, should they emerge. This could ensure that only those who have a genuine, bona fide record of residence would qualify. I anticipate that, based on his response in Committee, my noble friend may run two broad arguments. First, he may say that residence is very hard—possibly too hard—to establish and that unless we know what we are establishing, we should not go down that road. Secondly, he may be against the amendment in principle. On the first argument, I suggest that consultation with electoral registration officers, local authorities, and so on, could address the inevitable follow-up questions about who qualifies. I suggest, as a starting-off point, Sections 4 to 7 of the Representation of the People Act 1983. They give a useful and workable definition which has been in existence for 25 years and presents, as far as I know, and according to the chief executive of the Association of Electoral Administrators, no problems at all. But, as there is no suggestion that we would go down this path in the next two, three or five years, if there were any problems, issues and wrinkles outstanding, then we would have plenty of time to address them. The amendment is about establishing the principle. I do not ask my noble friend to agree that principle today. That is not the point of the amendment. I am not asking the House to support the principle of a residence-based pension; I am asking only that they support the principle of allowing a future Government to make that decision if they so wish. A different Government may take a view that is very different from that of the Minister. It is good public policy to keep options open, to future-proof. We owe to future Governments and future citizens of this country the practical possibility of clearing up the system if the Government of the day believe that it is right. I beg to move.