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Ministers face fight on pensions Ministers face fight on pensions
(20 minutes later)
The government is expecting a tight Commons vote over opposition plans to increase help for people whose occupational pensions have collapsed.The government is expecting a tight Commons vote over opposition plans to increase help for people whose occupational pensions have collapsed.
About 30 Labour backbenchers are expected to support an amendment to the Pension Bill, backed by the Conservatives and Liberal Democrats.About 30 Labour backbenchers are expected to support an amendment to the Pension Bill, backed by the Conservatives and Liberal Democrats.
But Work and Pensions Minister James Purnell said the government "should not write a blank cheque".But Work and Pensions Minister James Purnell said the government "should not write a blank cheque".
Tory leader David Cameron called for more help with "heart-breaking" cases.Tory leader David Cameron called for more help with "heart-breaking" cases.
'Remedy''Remedy'
At prime minister's questions, Tony Blair said there would not be an "unfunded commitment " of more help for people whose schemes had collapsed between 1997 and 2005.At prime minister's questions, Tony Blair said there would not be an "unfunded commitment " of more help for people whose schemes had collapsed between 1997 and 2005.
He added that the "cruellest thing" would be to tell people "we can make that commitment and bail them out when it transpires we cannot".He added that the "cruellest thing" would be to tell people "we can make that commitment and bail them out when it transpires we cannot".
During the Pension Bill debate, Mr Purnell said: "The government should not write a blank cheque but organise a remedy."During the Pension Bill debate, Mr Purnell said: "The government should not write a blank cheque but organise a remedy."
The government has pledged an expansion of the current Financial Assistance Scheme to help about 125,000 victims.The government has pledged an expansion of the current Financial Assistance Scheme to help about 125,000 victims.
Last month, Chancellor Gordon Brown announced its funding would be increased from £2bn to £8bn and it would cover everyone who lost all or part of their pensions between January 1997 and April 2005.Last month, Chancellor Gordon Brown announced its funding would be increased from £2bn to £8bn and it would cover everyone who lost all or part of their pensions between January 1997 and April 2005.
It will offer a financial "safety net" to members of about 660 company pension schemes that were closed while insolvent, typically when the employer went bust, before 2005, when new protection came in.It will offer a financial "safety net" to members of about 660 company pension schemes that were closed while insolvent, typically when the employer went bust, before 2005, when new protection came in.
But there has been criticism that the Financial Assistance Scheme is operating too slowly and that thousands of people who have applied for payments may have to wait years.But there has been criticism that the Financial Assistance Scheme is operating too slowly and that thousands of people who have applied for payments may have to wait years.
In the Commons, Mr Purnell announced a concession to critics on the Labour backbenches which, he said, should help a further 8,000 people whose schemes began winding up between January 1 1997 and April 5 2005.In the Commons, Mr Purnell announced a concession to critics on the Labour backbenches which, he said, should help a further 8,000 people whose schemes began winding up between January 1 1997 and April 5 2005.
This would happen "where a compromise agreement is in place and where enforcing the debt against the employer would have forced the employer into insolvency".This would happen "where a compromise agreement is in place and where enforcing the debt against the employer would have forced the employer into insolvency".
He added: "We estimate this will benefit an extra 8,000 people, members of some 15 schemes".He added: "We estimate this will benefit an extra 8,000 people, members of some 15 schemes".
The Pension Bill calls for the state pension age to rise to 68 by 2046.The Pension Bill calls for the state pension age to rise to 68 by 2046.
It also puts forward restoring the link between earnings and the basic state pension by 2012. Critics have said this is "too little, too late".It also puts forward restoring the link between earnings and the basic state pension by 2012. Critics have said this is "too little, too late".
The Tories and Lib Dems both support an amendment to the bill which would give a "lifeboat fund" to offer immediate help to people whose occupational pension schemes have collapsed.The Tories and Lib Dems both support an amendment to the bill which would give a "lifeboat fund" to offer immediate help to people whose occupational pension schemes have collapsed.
This would top up benefits to 90% of their expected pensions package at a cost of £600m.This would top up benefits to 90% of their expected pensions package at a cost of £600m.
Shadow chancellor George Osborne said it would be initially funded by a Treasury loan - and could eventually be paid off through unclaimed pensions assets. 'Sharing of pain'
Confidence motion Shadow work and pensions secretary Philip Hammond said: "If we are going to have a solution to these problems we have got to recognise that we are all in this together.
Last year Parliamentary Ombudsman Ann Abraham ruled the government was guilty of "maladministration", for failing to compensate the workers - but the government rejected her findings. "There has to be a sharing of their pain."
Mr Blair said taxpayers should not have to bail out private pension schemes - and the government could not take on a £15bn compensation bill.
Liberal Democrat work and pensions spokesman David Laws said: "Those who have lost their pensions will not forgive MPs who do not back a fair compensation package."Liberal Democrat work and pensions spokesman David Laws said: "Those who have lost their pensions will not forgive MPs who do not back a fair compensation package."
But the Association of British Insurers warned that the proposed "lifeboat fund" would amount to "another hit on pension funds".But the Association of British Insurers warned that the proposed "lifeboat fund" would amount to "another hit on pension funds".
Labour leadership hopeful John McDonnell has also tabled amendments to the bill to restore the link between earnings and the state pension immediately and restrict increases in the retirement age.Labour leadership hopeful John McDonnell has also tabled amendments to the bill to restore the link between earnings and the state pension immediately and restrict increases in the retirement age.