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Ministerial Pensions

Volume 577: debated on Wednesday 12 March 2014

In the spending review 2010, the Government announced their intention to increase employee contributions in public service pension schemes. This followed on from Lord Hutton’s interim report on public service pensions which concluded that there was a clear rationale for public servants to make a greater contribution if their pensions were to remain fair to taxpayers and employees and affordable for the country.

The ministerial pension scheme was not covered by Lord Hutton’s recommendations, but I consider it appropriate that its members face similar changes.

In 2012-13 pension contributions were increased in a similar way as applied to other public service pension schemes, and increases for 2013-14 were also applied from 1 April 2013. Further increases from 1 April 2014 will mean that:

Secretaries of State, the Leader of the Opposition in the Commons and Speaker in the House of Lords will pay an additional 1.2 percentage points of pay, and a total of 6.0 percentage points higher than 2011-12;

Ministers of State, the Government Chief Whip, the Leader of the Opposition in the Lords, the Chairman of Committees of the House of Lords and the Deputy Chairman of Committees of the House of Lords will pay an additional 0.8 percentage points of pay and a total of 4.0 percentage points higher than 2011-12; and

Parliamentary Under-Secretaries, the Government Whips and Opposition Whips will pay an additional 0.5 percentage points of pay and a total of 2.5 percentage points higher than 2011-12.

Ministers in the House of Commons make separate contributions towards their pensions as Members of Parliament. Responsibility for the setting of pension provision for MPs is the responsibility of the Independent Parliamentary Standards Authority.

The amendment scheme will also make provision that members who are part of a same sex marriage will be treated in the same way as members who are part of civil partnerships, in line with the Marriage (Same Sex Couples) Act 2013 and the arrangements for same sex marriage recognition in other public service pension schemes.

The amendments do not make any provision in relation to an accrued right which puts (or might put) a person in a worse position than the person would have been in apart from the provision.

The details of the new scheme have been laid in the Libraries of both Houses, along with a copy of the response to the consultation from the Chairman of the Parliamentary Contributory Pension Fund Trustees.