Amber Rudd will claim the Conservatives are now “on the side of workers” as she formally unveils plans to impose seven-year jail terms on bosses who are reckless with their employees’ pensions.
The work and pensions secretary will point to figures published on Monday that show more than 10 million people have been brought into workplace pensions saving by automatic enrolment since 2012.
“For too long the reckless few playing fast and loose with people’s futures have got away scot-free. Acts of astonishing arrogance and abandon punished only with fines, barely denting bosses’ bank balances,” she will tell MPs.
The government launched a consultation last summer as part of moves to beef up the powers of The Pensions Regulator (TPR), enabling it to step in more quickly and more often when companies make changes which could damage the pension scheme.
Rudd’s pledge follows the BHS pensions scandal. A year after it was sold by Sir Philip Green for £1 in 2015, the retailer collapsed into administration, leaving a £571m pension deficit.
Sir Philip later agreed to pay £363m towards it to end action against him by the Pensions Regulator.
Liz Truss, the chief secretary of the Treasury, backed Rudd’s proposals, saying it was wrong Sir Philip could “play merry hell” with pensions.
“It’s about saying that’s not acceptable, it’s not acceptable to play merry hell with the contributions workers have made over a period of time and essentially run off without making good the pensions you promised to those people in the future, and so we’ll take further sanctions,” she told Sky’s Ridge On Sunday.
Rudd will tell the Commons on Monday: “It’s the Conservative Party that has cut taxes for millions of low earners, created and raised the National Living Wage and now we’ve seen more than 10 million workers enrolled in a workplace pension, many saving for retirement for the first time.
“Automatic enrolment is an extraordinary success story. Thanks to this revolutionary reform, 10 million workers can look forward to a more secure future and a better retirement.
“That is a remarkable achievement. Workplace pensions had fallen out of fashion and were seen as the preserve of older, wealthier people. Now saving is the norm across the UK, wherever you work.”
Frank Field MP, the chair of the Commons Work and Pensions Committee, said Rudd deserved “huge credit” for the move to crack down on bosses.
But he said voters would be ″aghast″ strict rules do not already exist. “How could it ever have been legal for company bosses to recklessly or wilfully or risk their workers’pensions?” he said.