May I return to the topic of amendment 49, which I was very pleased to co-sign with the hon. Member for Brighton, Pavilion (Caroline Lucas)?
Let me start by reassuring my hon. Friend the Member for Bournemouth East (Mr Ellwood) that building a stable and cohesive society is one of the most fundamental roles of Government, so to be doing that today through debating this Bill is a highly appropriate use of parliamentary time. To those who ask whether we should be doing something else, I say that I can, perhaps unusually for a man, multi-task, so I think I can manage both to speak in this debate and to deal with other pressing issues.
Turning specifically to the amendment, it is important to distinguish between contracted-in and contracted-out pensions. This is quite a technical change and it does not apply to contracted-out pensions; it applies only to contracted-in pensions. As the hon. Member for Brighton, Pavilion said, two-thirds of pension schemes already allow spousal survivors in civil partnerships equivalent widow or widower benefits without having to be forced to do so by the law, but one-third of them are discriminating. What is worse, that is an optional discrimination; they are choosing to discriminate against surviving civil partners in contracted-in pension schemes.
Let me try to explain why that is so fundamentally wrong. The hon. Lady gave the example of John Walker. Had he married a woman, she would have got a pension on his death of £41,000, but his civil partner got a pension of just £500 per annum. That diversity is the wrong kind of diversity; that is pure discrimination. Let us assume two men or two women join a pension scheme on the same day, and they both have the same level of service, and they both enter into some form of partnership, but one gets married and the other goes into a civil partnership, and let us also assume that the day after they get married or enter their civil partnership, they are both, by some quirk of fate, killed in a car accident. The pension of the widow in marriage will be go back to the date her former husband joined the pension scheme, let us say some 20 years previously, but the civil partner only gets to go as far back as when civil partnerships came into law. That cannot be right by any stretch of the imagination.
When researching why the Government were resisting this amendment, I was told that one of the issues is the cost factor. Everything we as a Government do has a cost, so I thought there must be some huge cost—perhaps £4 billion, which was a ready price-tag yesterday. In fact, the cost of giving equal pension rights on contracted-in pensions to civil partners is £18 million—not £80 million or £80 billion, but £18 million. It is true that that is a lot of money, and I certainly would not mind having £18 million in my bank account, but let me put that into perspective. The assets under management of the pension industry amount to £360 billion, so the cost of removing this anomaly is 0.006% of assets under management. I do not think that is a price we cannot afford.
I was also told that it is wrong to force pension providers to make retrospective calculations on which they did not base their pension actuarial decisions. That, too, is a flawed argument. As the hon. Member for Brighton, Pavilion said, the actuaries behind a pension scheme make a whole variety of assumptions about longevity, how many of their pensioners will die in service and how many of them will die as a pensioner, and how long they will stay in the pension, and the accrual rate will be based on an assumption that most of their members will get married. It is complete nonsense
to suggest that pension providers cannot allow civil partners who survive to get the same benefit as a widow or widower because it has not been accrued, as there is absolutely no evidence that the actuaries have not been able to make that calculation. If they made the calculation that X% of their pensioners would get married, they could simply make assumptions about a man in a civil partnership. They will have had no knowledge of whether that man or woman would have decided to get married or to enter a civil partnership and there is no logical or financial reason why the anomaly cannot be removed.
I hope that the Minister will give some commitment from the Government that the anomaly will be reconsidered. I know it was mentioned in Committee and that the Government are resisting the amendments, but I urge my ministerial colleagues to address the issue.