Torsten Bell MP: speeches

Speeches

• 2 Sept 2025 · Pension Schemes Bill (Second sitting) · Hansard source

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  Q Thank you both for joining us today. I want to ask you to reflect on the internal consistency of some of what you have said. Implicit in what you are saying is that pension schemes should have been investing in a wider range of private assets over the course of the past 10 years, and that that is what they should want to be doing in future—so in some ways we have not been living up to our fiduciary duties in the past, and we are now making changes to do that. Given that that is your logic, the question is why that has not happened. If you go and ask actual pension providers why that has not happened, they will tell you they have a collective action problem and an industry focused exclusively on cost and not on returns, and that they struggle to deliver against that. If you have a collective action problem, you need to ask how we resolve that. You then get to the fact that the Mansion House accord is entirely industry led, with numbers set by them—it is not about distortion to the market; you might want to reflect on that, given the comments you have just made. You also spoke about a lack of clarity, but the Mansion House accord provides clarity about the objectives: everyone can see them and they are set by the industry. When it comes to savers’ interests, you know that the Bill includes a carve-out for trustees to say, “This isn’t in my members’ interests, so we won’t be doing it.” Reflect a bit on the consistency of the argument you have made about the real progress you want to see on investment in a wider range of assets—because it is in savers’ interests and should have happened in the past but did not—and the changes in the Bill. I would gently suggest you might want to think about the consistency of that. Sophia Singleton: We are not a mature industry—the defined contribution industry—and in the past we have not invested in these assets because there have been operational barriers, including the focus on cost.

• 2 Sept 2025 · Pension Schemes Bill (Second sitting) · Hansard source

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  That is not the view of the whole industry, which points to the collective action problem of an exclusive focus on cost, as much as it is a barrier— Sophia Singleton: The value for money framework in the Bill is extremely helpful—

• 2 Sept 2025 · Pension Schemes Bill (Second sitting) · Hansard source

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  And that compares to the Mansion House benchmarks of 10% and 5%. Ian Cornelius: The Mansion House commitment is 10% into private markets, with half of that into the UK, so we are already well ahead.

• 2 Sept 2025 · Pension Schemes Bill (Second sitting) · Hansard source

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  Q Are you already doing that because you think that that is what is in savers’ interests? Ian Cornelius: Absolutely. It is providing attractive returns, it diversifies risk and it also invests in the UK.

• 2 Sept 2025 · Pension Schemes Bill (Second sitting) · Hansard source

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  Q It is lovely to see you again, Rachel. Thanks for making the time today. A few people have asked questions about the LGPS through the lens of member engagement. There are obviously some implications with the move into greater pooling for that. Given that you are running that and seeing it up close, it would be good to hear your reflections on how that currently operates, as you have seen it over the last few years. Rachel Elwell: Again, for all of us working in the LGPS, that sense of purpose is really important. I know my partner funds do a huge amount to make sure they are engaging directly with members, running events, as well as the importance of member representation on the pensions committees and on the pension boards, whether that is through union representation, pensioner representation or other scheme member representation. We also have two fantastic scheme member representatives on our joint committee, which is the body that comes together across all of the partner funds to oversee and engage with what we are doing on their behalf. They are really bringing that voice into our considerations as a board and the wider organisation—the wider partnership.

• 2 Sept 2025 · Pension Schemes Bill (Second sitting) · Hansard source

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  It is. Sophia Singleton: —and we have said that we need to move the focus from cost to value, and we are seeing that very much come through in the culture within the industry, to be focusing on value. I have given evidence about funds recruiting investment teams to invest in these assets, because they are not simple to invest in for DC schemes. If you look at the experience in Australia through the covid pandemic, there were some real challenges that those schemes had to face relating to stale pricing, intergenerational fairness and cross-subsidies. They are not simple assets for DC schemes to invest in. The market is moving, going, and will get there. What we are saying is the mandation power is not needed to achieve that, because we are, with your help, getting to the right place.

• 2 Sept 2025 · Pension Schemes Bill (Second sitting) · Hansard source

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  Q This morning we heard from Legal and General and from Aviva on how they are planning to operationalise the requirements in the Bill on default drawdown products. I thought it would be good to give you the opportunity to answer the same question: how are you thinking about that within your organisation? Ian Cornelius: It is one of the elements of the Bill that we very much welcome. I think guided retirement solutions are overdue. Certainly, our members have been opted into a retirement savings scheme, and they end up with a pot of money rather than an income. I think their expectation is an income. In fact, in the research we have done with our members, they say that the most important things for them are to have a sustainable income, confidence that it will not run out and an element of flexibility, because their circumstances can change very quickly in retirement. I think the guided retirement solution moves us in that direction. At NEST, we have been working on this for some time, as we recognise that it is a core issue for our members. We therefore want to introduce a guided retirement solution—it is very much a work in progress—that delivers that sustainable income, but also gives them a guarantee that it will not run out. That will be some sort of deferred annuity, purchased probably when they are 75, to kick in when they are 85. We are actively working on that and will be looking to introduce it in 2027, aligning with the expectation in the Bill. Patrick Heath-Lay: It is very similar from our perspective. We should not underestimate how much onus the shift from final salary to DC has put on individual savers, in terms of the decision that they have to make, in a very complex world that they really do not understand. Even if you surface a lot of information, your constituents will still struggle to navigate those decision points. We also should not underestimate the onus they have taken on, in terms of the risk of their own fund, when you think about the productive finance agenda and other things here. I think it is absolutely the right move. It is a good development for us to bring about guided retirement journeys in a way that is either “Do it for me” or “Do it with me” for policyholders. Similarly, we are thinking about drawdown and how we can facilitate or help people to understand the implications of the actions they may take with accessing their funds, and then, when they get to later life, some sort of deferred annuity as an approach. The really important aspect is the guidance and how we can help, but have certain obligations on ourselves, as providers, to make sure that we are accountable for the help that we are giving as we go through the process.

• 2 Sept 2025 · Pension Schemes Bill (Second sitting) · Hansard source

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  Q Given that you think that it is in savers’ interests to be well above the Mansion House targets, why have some people not got to those targets? Are they failing in their fiduciary duties? Why have they not got there yet? Ian Cornelius: It is hard to speak for others, but scale is an important factor, as we have talked about. You need scale and sophistication to access these investment opportunities. NEST has that scale and is building that sophistication. It often involves quite innovative solutions and partnering. Partners want to partner with someone who has got scale and assets coming in at pace, and we have those things. There are some unique circumstances that have made it attractive for us. I will let Patrick speak for People’s, but it is on that journey as well. Patrick Heath-Lay: Yes, we are, although we are much nearer the start of that journey. Again, it comes back to the scale point. Why is £25 billion or £30 billion about the right amount? Because it is about the right part that you can economically start investing in those items. To answer your question, and to pick up a more general point, it is incredibly important that we work collaboratively on the issue, because, as an industry, there is not much point in us all sailing our own little boats around trying to find the right harbour to invest. There is a degree of collaboration that the industry, together with Government, can do to open up the opportunities where that investment needs to go and how it can be executed in the most efficient manner. The biggest risk with investing in private markets is that they are expensive. If the vehicles that are being used on a commercial basis are not sharing the economics of that investment well enough with savers, it will certainly not be an investment that we are interested in pursuing. The other point is that putting down the foundations for this to be a pipeline of repeatable investment activity is critical. Because of its scale, NEST has got ahead of where we are today, but that is the phase we are in at People’s at the moment. There is over £1 billion a year from our scheme alone that will be invested in those markets on an ongoing basis. Given the scale that we are both experiencing, in terms of how we are scaling up, that will be an ever-increasing number, so it is important that we have reliable and very cost-effective routes by which we can deploy that capital. Ian Cornelius: Going back to your original question, I think that the industry is moving in the right direction. The Mansion House accord had 17 signatories and we are seeing the right moves.

• 2 Sept 2025 · Pension Schemes Bill (Second sitting) · Hansard source

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  I was encouraging you to say that; you got there. Helen Forrest Hall: Apologies; we are very, very supportive of the vast majority. This is basically the one substantive issue from our perspective. As Sophia has said, the value for money and consolidation elements in particular are incredibly helpful in removing some of the barriers that have existed, including for trustees. They technically have the ability to operate within their fiduciary duty, but sometimes the legislation and the structure of the industry get in their way. Things such as value for money and scale will really help with that. This Bill is incredibly enabling in the vast majority of its provisions. There are just a small number—mandation being one of them—where we have a bit of concern.

• 2 Sept 2025 · Pension Schemes Bill (Second sitting) · Hansard source

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  Q We all have work to do; it is never all over. Chris, this question is mainly for you, as I am conscious that you have done lots of work over an extended period on the dashboard. Obviously, there are elements of the Bill that relate to that—mainly relating to the PPF—but not many. However, is there anything you want to tell the Committee about the lessons from it for when we come to the small pots work, which obviously is a central part of the Bill? Chris Curry: I listened with interest to some of the earlier witnesses talk about dashboards, and there certainly are some lessons that we can learn from the pensions dashboards programme, as it has been evolving over the past few years, for small pots in particular. There are two issues that I would pull out. The first is on the technology front. I think someone suggested that the next five years or so could be quite a tight timetable to build a technological solution and get it in place. You have to be very careful—you cannot underestimate just how much complexity there is and how long it takes to do these things—but I would say that the work that we have done on pensions dashboards is giving us a bit of a head start. That is not to say that we necessarily need to build on or use parts of the system that we have already built, but it has helped us understand a lot about, for example, how you can find pensions—the way you can use integrated service providers rather than having to go direct to all the schemes, and use a syndicated model to find where people might have their pensions. It has helped the industry get a long way down the path to where it needs to be, as well. One of the big challenges for pensions dashboards is the quality of data. Enabling individuals to find their pensions means data quality: it needs not only to exist and be there; it needs to be accurate and it needs to be up to date. When you are thinking about an automatic consolidator or default consolidator for small pots, that is even more important. You are not just transferring information, but transferring money, so it is really important that the data is high quality. The work that is being done on pensions dashboards will get people in the industry a long way to having part of that in place as well. There are definitely lessons that can be learned from how we progressed on the pensions dashboards programme. It has got us much closer to where we would be if we had had a completely blank page to start from, but there is still a reasonable amount of work to do, because it is working in a slightly different way.

• 2 Sept 2025 · Pension Schemes Bill (Second sitting) · Hansard source

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  Q You have both been involved in the discussions with the industry on the wider move to private asset investments. As you talked about earlier, you are further along the journey than most. You know the numbers in the Mansion House accord. In lots of cases, I know you are planning to be significantly above those de minimis levels. Tell us a bit—for the industry as a whole, not just for your individual schemes—about how we should think about those numbers, as de minimis or as targets, or where people are going to be in 20 years’ time. In the end, that is what we are always thinking about; we are not thinking about the next five years. Ian Cornelius: It is difficult to speak for the industry, but I can speak for NEST. At NEST, we are very committed to investing in private markets: 18% of our assets are invested in private markets, and 20% of our assets are invested in the UK.

• 2 Sept 2025 · Pension Schemes Bill (Second sitting) · Hansard source

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  Q The reserve power is about automatic enrolment contributions; it has no impact on the LGPS. It is the same for surplus: the changes do not apply to the LGPS. Could you confirm that I am correct in saying that? Councillor Phillips: Right.

• 2 Sept 2025 · Pension Schemes Bill (Second sitting) · Hansard source

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  Q Since we have gone to mandation and surplus, I encourage you to clarify that the reserve power and the surplus measures in the Bill do not affect the LGPS in any way. Those are not within the remit of the Bill. Councillor Phillips: My understanding is that it is a back foot.

• 2 Sept 2025 · Pension Schemes Bill (Second sitting) · Hansard source

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  Q Again, I would look at the actual history of what happened. The industry committed to private assets under the previous Government, and it is failing to deliver on that because of collective action challenges. You have to face up to this at the level of the sector as a whole; I am afraid you are giving answers that are very happy with the status quo, the way you are describing it. I would reflect that it is definitely a failure of fiduciary duty over the last 10 years not to have made more progress. Helen Forrest Hall: Just to give my own perspective, there are a number of structural issues with the development of the sector. Defined benefit has been in run-off, which has driven a particular type of investment strategy. DC has not been at scale, and a number of us in the sector have been calling for consolidation for a long time. I think it goes without saying that we are having this conversation in the context of being very supportive of the vast majority of provisions in this Bill.

• 2 Sept 2025 · Pension Schemes Bill (Second sitting) · Hansard source

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  indicated dissent. Councillor Phillips: It is not a back foot?

• 2 Sept 2025 · Pension Schemes Bill (Second sitting) · Hansard source

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  Q The other thing to touch on is that all the pools are moving towards FCA authorisation. What is your experience of that? Obviously, you are further ahead than most. Rachel Elwell: This is before I was employed to bring it to life. This is a decision our partner funds made really early, because they recognised the real benefits that can come from being FCA regulated. This is really important. We will hopefully be managing over £100 billion on behalf of the LGPS, and a good proportion of that is managed directly within my team. We are managing that for, hopefully, 18 different customers—effectively, investors and our owners. We need to have those disciplines in place, and we need to make sure that we are following those regulations. We do not need another regulatory set. There are already some very good, strong regulations that exist, so we, as a partnership and as a company, think that is the right thing to do.

• 1 Sept 2025 · Topical Questions · Hansard source

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  I thank the hon. Member for his question. We discussed this issue at some length in the statement before the recess. He knows that the priority for the Labour party has been to raise the state pension by committing to the triple lock throughout this Parliament at a cost of £31 billion a year. For the new state pension, that will mean an increase of £1,900 a year by the end of this Parliament. On winter fuel payments specifically—and I thought this was the Conservative party’s position—most people think that we should not be paying hundreds of pounds to the very richest pensioners. We have listened to concerns and raised the threshold, but it is important to maintain that principle. If the Conservatives’ position is now that they want a return to universal winter fuel payments, they need to have a word with the Leader of the Opposition, who has not supported universal winter fuel payments or, indeed, a universal state pension.

• 1 Sept 2025 · Topical Questions · Hansard source

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  I thank my hon. Friend for his crucial question. That is exactly why we have revived the landmark pensions commission. We have to confront the reality that we are on track for tomorrow’s pensioners to be poorer than today’s. Auto-enrolment has been a huge success, with 88% of eligible employees now saving, but 45% of working-age adults, including 3 million self-employed and one in four low earners, are currently saving nothing. The commission will ensure that we build a pension system that is strong, fair and sustainable.

• 1 Sept 2025 · Topical Questions · Hansard source

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  The hon. Lady only had to wait till next week’s Treasury questions, when she could have asked her question, but she has the same answer. What we should do is look at the record of parties and what they have done. When I look back over the last 14 years of Tory Budgets, I see a party— [ Interruption. ] And the Lib Dems; thank you for pointing that out. I have seen parties chopping and changing pension tax relief left, right and centre, because they had no plan. Those were the same Budgets that drove child poverty up and wages down.

• 1 Sept 2025 · Topical Questions · Hansard source

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  Absolutely.

• 1 Sept 2025 · Pension Credit Uptake · Hansard source

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  My hon. Friend has raised this matter with me before, and the one thing I can confirm is that she is a powerful advocate for her constituents on this very important issue for them. As she knows, I cannot comment on individual cases—particularly as the matter is now with the Pensions Ombudsman—but more generally, it is important that promises made to pensioners about their pensions are lived up to. Making sure that happens is exactly why the Pensions Ombudsman exists.

• 1 Sept 2025 · Pension Credit Uptake · Hansard source

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  I thank the hon. Member for his question, but would gently say that every time he opposes every single tax rise or any difficult choice in this House, he is saying that the Liberal Democrats are not a party that could deliver on commitments, for example, to the triple lock, which will increase in cost, as my right hon. Friend the Secretary of State mentioned earlier, by £31 billion by the end of this Parliament. There are things called “choices”, which are necessary if we are to provide for our top priorities—and for Labour Members, the top priorities, when it comes to pensioners, are making sure that we can increase the state pension, the bedrock of most pensioners’ living standards, and saving the NHS, and that is exactly what we will continue to do.

• 1 Sept 2025 · Pension Credit Uptake · Hansard source

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  I hope the hon. Member will write to me with the details of the case she raised. On the more general picture, I can reassure her that we now have a lower backlog of pension credit cases to be processed than we inherited from the last Government, despite the record number of claims that have come through.

• 1 Sept 2025 · Pension Credit Uptake · Hansard source

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  I thank the hon. Member for his question, and I congratulate Members on all sides of this House who have run campaigns to drive up pension credit uptake. That is very important, and it is why we have seen 60,000 extra awards over the course of the year to July 2025 compared with the previous year. That work, which is very welcome, has been done by not just Members but civil society organisations and local authorities. On the points that the hon. Member raised about the process for winter fuel payments this winter and going forward, I do not agree with the characterisation he chose to present. Particularly on the tax side, the process will be automatic. Nobody will be brought into tax or self-assessment purely because of that change; the vast majority of people will have their winter fuel payments automatically recouped through the pay-as-you-earn system; and anyone who wants to can opt out. I remind Members that the deadline for that is 15 September.

• 1 Sept 2025 · Pension Credit Uptake · Hansard source

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  The Government are committed to ensuring that all pensioners receive the support to which they are entitled. That is why we have been running the biggest ever pension credit take-up campaign. We plan to continue promotional activity from September through to the end of this financial year, with the focus not just on eligible pensioners but on their friends and family too.