"Let me be clear where we are. No university student studying for their first degree either full time or part time will be obliged to pay any fees starting in 2012. No university student has to pay anything to their university for tuition during their studies and no graduate will be obliged to pay anything back until they are paying at least £21,000 a year. After that, they pay back a proportion of their income through the tax system.
"Whatever our thoughts on the politics of university finance, no one should say that anything that the government has done will make university tuition unaffordable. And no one should pretend that the system as introduced is not very similar to the graduate tax proposed by the National Union of Students.
"The policy also includes part time students for the first time which means they will no longer have to pay up front fees, repayments are made starting at a higher income, and there is now a mechanism for making very high paid graduates contribute more to the financing of the higher education system than lower paid graduates. These changes make the new system of student finance much fairer and more progressive than the one this government inherited."
The Minister has joined forces with 17 experts and interested parties from across Government, universities, charities, industry and research organisations to look at ways to work together to increase the volume and impact of dementia research and improve the lives those living with this devastating condition.
They have today launched a 'Route Map for Dementia Research' which:
Figures released by the Government show that over 103,000 additional apprenticeship started in 2010-2011, bringing the total number of people on an apprenticeship scheme to 257,000.
Commenting, Liberal Democrat Business Secretary, Vince Cable, said:
"The growth in apprenticeships to more than double the planned ambition, demonstrates our commitment to delivering the skills businesses need to grow and young people need to build productive careers.
"We're determined to do more to boost growth, rebalance the economy, extend opportunity and break down barriers between academic and vocational learning.
"Our planned investment will deliver some 360,000 apprenticeships this year alone, and we'll continue to work with the business community to make it easier for more employers of all sizes to take on an apprentice and reap the benefits they bring.
"With every £1 of Government money delivering a return of some £40 to the wider economy, this is a sound investment in the country's future."
In a keynote speech in Brasilia he announced that more than £2.5bn in bilateral business has been agreed between British and Brazilian companies this year.
The Deputy PM also announced new deals including a £130m contract for BT to provide data transmission services to Correios, the Brazilian post office, and the UK Government underwriting a £185m credit line to the Brazilian steel company Gerdau that will lead to more than £270m in exports to Brazil from 79 companies across Britain.
Leading a delegation of Cabinet Ministers and UK business leaders in talks with their counterparts in Brazil, Mr Clegg sought to promote the best of British in Brazil and attract inward investment from major Brazilian firms. The £2.5bn of business highlighted today represents a significant boost to the British economy, creating jobs and growth through both exports and inward investment.
The visit this week marks the next vital phase in the UK's re-engagement with Latin America, which was kicked off by theDeputy Prime Minister in Mexico earlier this year. In order to achieve sustainable growth and a balanced economy, the UK is determined to make the most of the opportunities offered in the region, and Brazil offers trade in both directions across a range of sectors.
"I have to confess: this is my first trip to Brazil. But I have wanted to come here for many years.
"Like all of your visitors, I've been struck by Brazil's beauty, your hospitality. But, more than anything, by your sense of pride, of confidence. By the sense that right here, right now, so much is possible.
"It's no real surprise, of course.
"In just a few decades Brazil has undergone a transformation that takes most countries centuries.
"Democracy, growth, economic development. Millions lifted out of poverty - 24 million in just eight years. A voice on the global stage that grows stronger by the day.
"In all of history has a country ever risen so dramatically, so peacefully, attracting such global goodwill?
"Brazil was once described as a country of the future; clearly now it's the future that belongs to Brazil.
"And it's our shared future I want to talk about today. A new partnership between Brazil and the UK. A partnership for prosperity, where we work together to generate wealth and opportunity for our people.
"Trading more, learning from each other as we reform our economies, but also standing shoulder to shoulder in the world to advance our common values: democracy, fairness, economic openness, multilateralism.
"Because, in the long-term, that's how we create the peaceful and stable world in which we both can thrive.
"Before I talk about how we can work together more closely, let me set out why I believe we can.
"History shows that UK-Brazil relations matter.
"In the nineteenth century Britain supported and helped in Brazil's war of liberation and negotiated Portuguese recognition of Brazilian independence.
"A hundred years later, as Europe was torn apart by unprecedented destruction, Brazilian soldiers fought with us, helping to defeat the forces of fascism. Making sacrifices for which we will always be grateful.
"Ours has long been a reciprocal friendship, a two-way friendship between nations that stand together when it counts.
"Our ties are not new, but they have been allowed to slacken.
"We don't trade enough. We don't share knowledge in the way we could. We don't automatically think of each other as allies in the world.
"True, recent years have seen some improvement - in business and investment; in cooperation in defence, and on development policy.
"We worked together effectively on biodiversity at Nagoya, and on climate change at Cancun.
"I don't want to downplay that progress. But we must be much more ambitious about what we can achieve together.
"There remains great potential for Brazil and the UK to do more.
"That's why I'm here.
"As part of a new and lasting period of engagement between our great nations. Modern nations. Reforming nations. Nations that do not look at the world as it once was, but who see it for what it is today, what it will be tomorrow.
"And who understand that, on all of our big challenges - tackling global warming, setting the world on a path of sustainable growth, eliminating poverty and disease, fighting terrorism and organised crime - on all of them we are stronger together than we are apart.
"At the heart of this partnership are our values.
"The world is often carved up according to imaginary lines: North/South; East/West; Developed/Developing.
"But the real divide is about what you believe.
"There are closed societies: where power is abused, liberty curtailed, opportunity hoarded, and governments look inwards as the rest of the world is shut out.
"And there are open societies: internationalist in spirit, committed to fairness, freedom and democracy.
"Brazil and the UK stand on the same side of that divide.
"Of course, in any genuine, equal partnership there will be give and take. Moments when we don't agree.
"We look, for example, for the same outcomes in the Arab world, yet we sometimes differ on the best way to achieve them. And, when we disagree, we should be upfront about it.
"However, I believe, ultimately, we can be confident about navigating those moments.
"Confident that, while we may differ on the means, we nearly always agree on the ends and, in our heads and in our hearts, we are usually coming from the same place.
"So how do we deepen our ties?
"The first part of the answer is trade.
"For the UK, this visit is, ultimately a trade mission. If that sounds hardheaded, that's because it is.
"Trade means jobs. That's what the people of the UK want.
"But never underestimate the cohesive power of trade.
"It brings people together, fostering new understandings. Not between governments, or diplomats, but people; businesses; their staff; and their communities too.
"Trade ensures nations have a stake in each other's success. In working together peacefully, constructively, and towards the same goals.
"So I'm delighted to unveil new business contracts between UK and Brazilian companies worth £2.5bn to the UK economy - a significant boost.
"BT, BP, BG - British companies, doing more business in Brazil, bringing the benefits home.
"Contracts that boost the bright futures of some of our most iconic businesses, like Rolls Royce and JCB, both of which are expanding operations here in Brazil.
"Contracts that filter down the supply chain.
"For example, by underwriting a credit line for Brazilian steelmaker Gerdau, the UK government has secured £270 million worth of exports from the UK, with orders placed with dozens of companies around the country.
"And contracts that help the UK rebalance our economy away from our previous overreliance on a limited number of sectors, with deals in telecoms, manufacturing, pharmaceuticals - some of the key industries to the UK's future success.
"I'm accompanied by a business delegation, representing energy, infrastructure, engineering, financial services, to name a few. Here to promote the UK as one of the easiest places on the planet to do business - that's according to the World Bank - as well as a gateway to global markets.
"And we are deeply ambitious about what we want to achieve.
"Nothing short of a new era in expanded trade and booming business between our two nations.
"It is true that the UK was hit hard by the global financial crisis, and the UK Government is having to implement a decisive plan for fiscal consolidation, cutting spending and raising some taxes too.
"But, by doing so, we have retained the confidence of international markets and gained the backing of major international institutions, including the IMF, the EU, and OECD.
"We are also reforming our financial sector so that risk is better managed, and the wider economy is better insulated from shocks.
"So the UK should be an attractive destination for Brazilian investment. And we offer a different kind of deal.
"We know what the Brazilian economy already excels at.
"We know too how many international partnerships you have forged.
"But the great challenge for all advanced economies in the 21st century is to stay smart. To get ahead of the curve - in technology, in education, in energy efficiency, effective regulation and public services.
"That is where we can help. Ours is a dynamic, agile, and innovative economy.Where we value sustainability, where we recognise the need to confront structural barriers to growth.
"That's why we're focusing resources on schools and training. We're reforming higher education to keep our universities world class, and we're building on our world-class research base to get further ahead in the industries of the twenty first century: green technology, renewable energy, aerospace, and many more.
"It's a long-term view. Looking beyond the next year, or the year after. Looking decades ahead.
"Because that is the key to growth that lasts.
"I know Brazil is also thinking not only of today. That you are lifting your sights to the horizon. And on that we can help each other too.
"We can learn from each other to diversify our economies, drawing on each others' expertise.
"Your success in biofuels and renewable energy. Our experience in carbon trading and our new Green Investment bank - a world first.
"Your groundbreaking welfare programmes. Our insights in education.
"We can pass on lessons from our preparations for London 2012 to help deliver a successful Rio 2016.
"Perhaps, in return, you can tell us the secret of how to win five world cups.
"It's a new way of working together - a step change in our relationship.
"This week we are agreeing UK/Brazilian cooperation that - in its scope and depth - has never been seen before.
"On crime, to tackle drugs here in Brazil and help get cocaine off the UK's streets too.
"On international development, to combine our efforts and help some of the world's poorest.
"On the upcoming Rio +20 conference - twenty years on from the 1992 Earth Summit - to set out a plan for sustainable global growth.Never have our nations agreed to work so closely, on so many issues...Coming together for our common good.
And as we move forward together, we must recognise that this partnership is not just about what we can do, directly, with each other, but also what we do, together, in the wider world.
"Because our fortunes do not exist in a vacuum. They depend on the health of the global economy within which we operate and, following the global financial crisis, that economy is still not in a good state.
"Different countries have weathered the storm differently. Brazil has dealt with it extremely well.
"You were the last into recession and the first out - and, again, there are lessons we want to learn.
"And the challenges nations face are also different.
"In the UK we are dealing with the consequences of years of excessive debt, private and public.
"In Brazil, you are thinking more about the dangers associated with rising inflation.
"In the UK we are having to rebalance our economy by moving away from private consumption and government expenditure, towards net exports and investment. That, along with fiscal consolidation, will help deliver sustainable growth.
"For so-called emerging nations, on the other hand, rebalancing means deepening domestic markets to increase consumption and spread the benefits of prosperity.
"But what is the same is that, for either of us to meet those challenges, we both need a global economic environment able to withstand shocks.
"Where we strive for steady and sustainable global growth based on stable finances, built on responsible financial markets and underpinned by political stability.
"That means effective international institutions. And it's on that point that I would like to finish.
"In our interdependent economy, multilateralism is not a luxury, it's a must.
"But our institutions must be more nimble. Better equipped to guard against risk, respond to crises, enforce rules and norms that advance our shared success.
"That will be impossible until those institutions are reformed to suit the modern world. Until they reflect today's geography of power, with all of the major powers properly heard. Nations - like Brazil - who should be shaping the agenda, offering unique insights, being part of the big decisions, and then using your power to see those decisions through.
"Huge strides have been taken in establishing multilateral cooperation over the last sixty years, but the reality is, unless new actors are brought fully into the multilateral system, they will increasingly look for other ways to operate and our international institutions will become increasingly defunct.
"The UK doesn't want to see that happen.
"That's why we actively support a permanent seat for Brazil at the UN Security Council.
"We pushed for the recent changes to IMF voting weights, to more fairly distribute influence. Changes we're ratifying through our Parliament, without delay.
"And we want the G20 to continue as an effective, inclusive forum where we address global economic challenges.
"So it's time for old powers to make space.
"We want you with us, fully represented.
"But - of course - fully responsible too.
"Being a full member of the club is one thing, but it becomes meaningless unless we all make sure that club works.
"So our nations must be activists for the things we believe in.
"We see Brazil doing that more and more, whether by standing up for human rights or helping deliver peace and stability - not least through your leadership of the UN Stabilisation Mission in Haiti.
"That increased engagement bodes well for the future. Because the world needs an active Brazil, fighting for progress on a fair, global trade round.
"Using your experience and growing influence to help secure stability in the Middle East. Helping implement the climate change commitments agreed in Cancun. And building on them to deliver a successful Durban Summit at the end of the year.
"Promoting democracy because you know from your own experience that in underpins stability and success.
"It's no coincidence, after all, that of the world's top twenty economies only three are not fully democratic.
"On every big question facing the world today, there is no answer without Brazil. And the UK wants to stand alongside you to find the best solutions.
"So, to conclude - a new partnership for prosperity between Brazil and the UK.Built on trade, on sharing knowledge and expertise. Where we fight for our values - democracy, fairness, openness.
"Working alongside each other in international institutions fit for the 21st Century.
"It's a different kind of relationship, with Britain and Brazil partners for prosperity and social progress, and partners in a fairer, more responsible global system.
"And we must now make a choice:
"We can drift along as before. Friendly, but not very close.
"Working together sporadically, but not building deep and lasting bonds.
"Or we can commit to a real, meaningful, strategic partnership, coming together as a new force.
"One that will be good for the people of the UK, good for the people of Brazil. And, I believe, good for the wider world."
"In 1970 a person reaching 60 could expect to live a further 18 years. Last year, they could expect to live another 28 years. Advances in healthcare, living standards and technology mean that people in the UK are living longer and life expectancy is rapidly increasing.
This is something we should celebrate, but it is also something for which we must plan. We cannot expect people to work until they drop but the longer people spend in retirement, the more strain this puts on public services and, in particular, on the Government's ability to pay people a decent pension."
"Few subjects are as open to misunderstanding and misrepresentation as public service pensions.
"Pensions are vitally important to all of us, but they are also both complex and long-term.
"Pensions for public service workers even more so, not least because it's a benefit for one part of the population, that's paid for by all of us.
"And this debate takes place at a particularly sensitive time, because everyone is under financial pressure right now. People in the public service are facing the second year of a pay freeze...and job insecurity is a feature for some, as the Government gets to grips with the enormous budget deficit.
"Everyone in Britain is facing a rapidly rising cost of living. And millions of private sector workers have taken pay freezes or worse in the last 3 years.
"So just as public service workers want to protect their pensions, millions of other taxpayers are asking why is it fair that they should be asked to pay more tax to fund public service pensions, especially as the value of their own pensions is falling. In fact, in the private sector, very few know what they will receive in retirement at all, and they receive considerably less or nothing at all by way of employer contributions. Of course, over 12 million are making no provision at all.
"And on top of that, the State Pension Age is already rising to 66 with further rises thereafter, and taxpayers across the country are adjusting to this reality. To a longer working life... to pay for a longer retirement.
"It is absolutely wrong to pretend that public servants can be insulated from the pressures that everyone else are facing. It is unjustifiable that other taxpayers should work longer and pay more tax so public service workers can retire earlier and get more than them.
"It is the employees who are benefiting from longer life and generous pensions, but it is the taxpayer who is picking up the tab.
"In this context, it should not be a surprise that the debate on the future of public service pensions is often polarised between two extremes, neither of which is based on fact.
"On the one hand, there are those trades Unions who seem to believe that pensions for public service workers should not change, irrespective of the huge economic, demographic and social changes going on around them.
"On the other hand, there are those equally misguided voices who seem to think that the public service should be the front runner in a race to the bottom.
"Between these two, the Chancellor and I believe there is an indisputable case for reforming public service pensions to ensure that they are affordable, sustainable, high quality and fair in the face of huge demographic changes.
"Reform that ensures that the costs of providing pensions to our workforce are affordable, not just now...but in the decades to come.
"Reform that is sustainable by ensuring that the financial implications of longer lives are fairly shared between employees and other taxpayers.
"Reform that also corrects the huge unfairness in the current arrangements, where low paid workers subsidise the rewards of the highest paid.
"And reform that ensures that public service workers continue to receive among the best, if not the best, pensions available
"We have been engaged over the last few months in discussions with the TUC about these issues. These discussions have been constructive, positive, and frank. There is a commitment on behalf of both the Government and the Unions to seeing these talks through. And these talks will continue this month and later in July.
"So it is all the more disappointing that there are a minority of Unions who seem hell bent on premature strike action before these discussions are even complete. To justify strike action, they are misrepresenting the Government's position and feeding their members scare stories.
"I say to members of those Unions, a strike now might be in the union boss's interests, it is not in yours. Don't let them sacrifice your pension for their political platform.
"Only 1 in 5 PCS members voted for strike action on Wednesday. That in itself demonstrates how the vast majority of PCS members realise strike action is unjustifiable.
"Of course, it may be that those who oppose change think that they can force the Government to change its mind. This head in the sand approach is a colossal mistake. This Government will reform public service pensions. This is the time to shape that change not to try and block it.
"The history of reform is littered with examples where people simply deny the facts, deploy their myths and dig their trenches . They may hold out for a little while, but eventually reality bites. And when it does, change is urgent and uncompromising.
"Instead, where people seize the opportunity for change and seize the chance to shape their future, a much better change can happen. Lord Hutton, the former Work and Pensions Secretary, has created the chance of a better change. And our offer is by far the best that is likely to be on the table for years to come.
"Today, I want to set out the case for reform and spell out how our proposals would affect public service workers, as well as taxpayers.
"The details are very important here, and I will set them out shortly. But let me sum up our position to the vast majority of public service workers:
"We are all living longer. That means more years spent in work, as well as in retirement. To keep the best pensions in the country, you will have to contribute more. Those contributions will support your pension, not subsidise the pensions of top earners. So when you do reach retirement age, the pension you receive will be broadly as generous for low and middle income earners, as it is now. At the same time we are protecting the pension that you have earned to date. We are reforming for the future, but we will not touch the pension that you have already earned.
"Working longer and paying in more may not be what public service workers want to hear, but it is simply a fact of life for every single person in this country, whether you work in the public or private sector.
"On the other hand, pensions broadly as generous for low and middle income earners as they are now, will not be welcome to those who want to decimate public service pensions. But I believe it is absolutely right to offer the best pensions in the market to people who spend their lives serving the public.
"That is not the wanton destruction that has been either predicted by some, or demanded by others. Instead, it is a fair and affordable proposition that can be sustained for decades. Thanks to Lord Hutton, it is a proposition around which cross-party consensus can be built.
Case for reform - Living Longer and linking the NPA to the SPA
"Let me explain the argument for reform in more detail.
"Lord Hutton, led the Independent Commission on Public Service Pensions which produced its final report in March this year. The Commission provided a fundamental structural review of public service pension provision.
"I want to pay tribute to Lord Hutton for his clarity of analysis and his far reaching proposals which the Government has accepted as the basis for consultation.
"It is that review that has provided the clear and compelling facts on pension reform.
"And the facts are these:
"Firstly, we are living longer. As Hutton has said himself, 'longevity [is] the main risk to the sustainability of public service pensions'.
"The average 60 year old today is living ten years longer now, than they did in the 1970s.
"But that also means we are spending longer in retirement. As the Hutton report says, with a retirement age of 60, approximately 40 to 45% of our adult lives are now spent in retirement, compared with around 30% for pensioners in the 1950s. Hand in hand with that, we are drawing a pension for much longer than used to be the case. Instead of taking up a pension for 20 years as it was in the 1950s, public service employees are taking up a pension for about 30 years, a 50% increase... each and every one of us will be retired for longer and picking up our pension for longer.
"And the number of pensioners will continue to increase dramatically. The Hutton report expects that over the next 30 years, the number of UK citizens aged over 70 will nearly double... rising from 7.3m, to almost 14m people.
"This is a fantastic development for society, but it also presents a financial challenge.
"And the costs have already risen dramatically...total payments to public service pensioners and their dependents were almost £32bn in 2008-9, an increase of a third in real terms over the last decade.
"But whilst it is the individual public service employee that reaps the benefits of receiving a pension for longer... as things stand, it is not the employee that's paying extra for it.
"In fact, personal contributions compared to taxpayer contributions have gone down. For instance, when the Teacher's Pension Scheme began, employee and taxpayer contributions were equal at 5%. Today however, current members pay around 6% with taxpayers contributing more than double that at 14%.
"This huge disparity is replicated across public service schemes where the taxpayer consistently pays more. NHS employee contributions vary from 5.5 to 8.5%, whereas the taxpayer again contributes 14%. Civil service employees contribute between 1.5 and 3.5%, whereas the taxpayer contributes 19%.
"As Hutton said, "improvements in longevity have...increased the cost of paying public service pensions", but given the lack of reform, he also cautioned that "these costs have generally fallen to the taxpayer, either through increased employer contributions to schemes, or as a direct subsidy from the Exchequer when benefit payments are made"
"The private sector woke up to this shift over the last two decades, started to change, and in many cases abandoned their defined benefit schemes altogether. Some suggested, wrongly, that the State had no choice but to follow suit.
"Whereas once public service pensions were the benchmark that the private sector measured itself against, they have become so out of touch with increasing longevity, that no-one looks to emulate them anymore.
"Take as an example a highly paid London Head Teacher retiring with an annual pension of £42,000 a year and a lump sum of £126,000. To get that in the private sector you'd need a pension pot of around £1.6m. Even more staggering...take a top civil servant earning around £200,000 at retirement, receiving £100,000 a year in pension and a lump sum of £300,000. To get that in the private sector you'd need a pension pot of £4m.
"But too often private sector reform was a race to the bottom.
"We have already said that we will not join that race.
"We have chosen defined benefits because we know that public service workers place huge stock in having the certainty of a guaranteed and defined pension in retirement.
"But we will only continue our defined benefit schemes as part of wider reform.
"We must address the imbalance between employee and taxpayer contribution.
"Why should the general taxpayer have to work longer before drawing their pensions, when public service workers don't? Why should the general taxpayer have to pay taxes supporting public service pensions for workers retiring earlier than them?
"Most people, most public service workers included, know that's unfair.
"It's only right that public service workers , like everyone else, work that bit longer and contribute that bit longer to their pension.
"For that reason, we are proposing to link the Normal Pension Age to the State Pension Age. That is, we propose linking the age you can draw your occupational pension, to the age that you can draw your State pension. And the two would continue to track each other in the future as we as a society benefit from greater longevity.
"Through this change we would move the proportion of adult life spent in retirement for public service workers back to about a third - that's roughly where it was in the 1980s.
"The exception is the uniformed services - the armed forces, police and firefighters - where the pension age has historically been lower to reflect the unique nature of their work. We accept Lord Hutton's recommendations in this case that 60 should be the benchmark Normal Pension Age for the uniformed services.
"For those that would change, as I said, we are still protecting those benefits that you have accrued to date under the old scheme. But not only would we protect those amounts, we would protect when you can draw them.
"As such, you would still have and you could still draw that first part of your pension at the retirement age you were originally expecting.
Case for reform - final salary scheme and move to career average scheme
"The second argument for reform is that a scheme based on the 'final salary' is inherently biased against low earners.
"The current scheme works against those employees who stay on a low salary over their career, compared to those who receive a high salary, for the few years towards the end of their career.
"For top 20% of earners, the median annual pension payout is £42 for each £100 paid in. In contrast, the bottom 20% of earners can generally expect just £30, for every £100 they pay in.
"In some instances, the higher earners can receive up to twice as much in benefits per pound they put in compared to the lower earners.
"Of course, a more successful career will lead to a more generous pension. But in some cases, the high earner ends up with a pension that amounts to 90% of their average salary, whereas the low earner receives just half of their average salary.
"It's unfair on the lower earners who lose out because they didn't make the salary leap in the final years of their career. And more often than not it's women rather than men... typically and unfairly the low earners in their career, who are discriminated against the most by this bias.
"For that reason we are proposing therefore that for future pension accruals, the defined benefit will be linked to the average salary over your career and not your final salary.
"A career average scheme would guard against the risks and costs that come from individuals jumping to higher salaries in the last few years of their career. It would mean that everyone will get broadly the same amount for every pound they put in. This would be an inherently fairer system for the future.
Case for reform - conclusion
"Those are the facts.
"Under the current system, as we live longer, current levels of contributions are unfairly balanced between the employee and taxpayer.
"Under the current system, the final salary scheme is unfairly biased towards the higher earners.
"The case for reform is clear and compelling.
"As Lord Hutton says himself, and let me quote ..."there will need to be comprehensive reform." Change is needed to "make public service pension schemes simpler and more transparent, fairer to those on low and moderate earnings, better able to deal with the changes that we know are coming to our economy and our society, and will therefore help ensure greater prospects for sustainability over the longer term."
Our promise
"But at the same time, we need to ensure that public service pensions remain among the very best available. We want them to be the benchmark against which all other pension provision is compared.
"Public service pensions are an important and valued part of the remuneration offered to public servants and they ensure dignity in retirement.
"In Hutton's words, reforms must "balance the legitimate concerns of taxpayers about the present and future costs of pensions commitments in the public service, as well as the wider need to ensure decent levels of retirement income for millions of people who have devoted their working lives in the service of the public."
"In that spirit, first and foremost, we remain committed to defined benefit pensions. That means that every public service worker will receive a guaranteed amount in retirement - not an uncertain amount based on the value of an investment fund or cash pot like most people in the private sector.
"This is a substantial benefit.
"I also want to make it absolutely clear that we are fully committed to protecting the pension that has been earned to date.
"It has been suggested that through our proposed changes, we would be stripping workers of the benefits that they have already accumulated.
"Let me say categorically, this is not true.
"The benefits that you have already secured under the current final salary scheme would be protected.
"Let me be clear what this means: for what you have accrued, the 'final salary' which is used to calculate that pension would be the one you have when you eventually decide to retire or leave the scheme altogether.
"And again, for what you have accrued, we would not be changing the age at which you can claim those benefits. You could still draw that part at the retirement age that you were originally expecting to claim it.
"We will honour, in full, the benefits earned through years of service. No ifs, no buts.
"So to those who are surreptitiously advising scheme members to pull out of their pension now - and, yes, this is happening - I say stop. You should be ashamed at advising people to act against their own best interests.
Reforms already announced
"As well as the longer term proposals that we are currently consulting on, as part of last June's Budget and Spending Review, we have already taken immediate action that affect public service pensions.
"Firstly, we have already changed the way the value of the pension tracks inflation. We have switched to the Consumer Prices Index instead of using the Retail Prices Index for benefits, including public service pensions. The CPI is already used to set the inflation target by the Bank of England. It is the appropriate index to use in future. The CPI better reflects everyday prices and provides a better reflection of the inflation that people actually experience.
"Secondly, from April 2012, we will be phasing in an increase in pension contributions. This is vital to redress the imbalance between taxpayer and employee contributions to pensions discussed earlier.
"Indeed, Hutton's Interim Report concludes that "there is a rationale for increasing member contributions to ensure a fairer distribution of costs between taxpayers and employees."
"And in fact the last Government had already agreed with the Unions that there needed to be an increase in employee contributions. That agreement would have resulted in around £1bn extra of employee contributions to take place next year.
"The Government said in the Spending Review thatit will implement progressive changes to employee contributions, equivalent to three percentage points on average, which will lead to an additional saving of £1.8 billion a year by 2014-15, to be phased in from April 2012. We are in discussions with the Unions about implementation of our proposal, but this would mean a total of £2.8bn in extra employee contributions by 2014-15.
"But 3.2pp is the average increase. The increase will not be the same for all levels of income.
"We are proposing in particular that the lowest earners will face the least, or even zero increase in their contributions. Our proposal would not increase contributions at all for those earning less than £15,000 a year, and we propose a limit of 1.5 percentage points increase for those earning up to £18,000. This would be progressive and fair. It would help to ensure that the increase in contributions will not cause people to opt out.
"It would be in keeping with the Government's strategy to protect the lowest earners... as we have done by raising the income tax threshold... and as we have done by taking tough decisions on a pay freeze, whilst accepting recommendations from the Pay Review Bodies to provide a £250 pay rise for public service workers earning less than £21,000 pounds.
"Furthermore, we have been clear that for all income brackets where there is an increase in contributions, this increase would be phased in over 3 years. Our proposals would mean that in 2012, 40% of the increase will apply... approximately the same amount that had already been agreed between the Unions and the previous Government through the 'cap and share' arrangement. In 2013, 80% of the increase will apply, and 100% in 2014.
"Both the changes to CPI and the changes to contributions are vital to putting pensions on a fair and affordable footing in the short and long term.
No further changes
"We have already instituted the change to the CPI and we are consulting with the Unions on the increase in contributions. We are determined to see both these changes through as a first step to reform.
"We are also consulting with the Unions on reform for the longer term. Our proposals to link the Normal Pension Age to the State Pension Age, and shift to a Career Average Salary Scheme would see pensions through not just the next five years, but the next generation and beyond.
"We are not looking to make any other changes to how you contribute to your pension.
"I am also aware that our consultation on the Fair Deal policy is a major concern for Trades Unions. The consultation closed on Wednesday and we will carefully consider all the responses we have received.
Conclusion
"We are undertaking wide and open consultations to ensure that we can reach agreement on a fair level of the pension benefit, fair to public service workers, and fair to the general taxpayer.
"Most public service workers will understand that something's got to change.
"But they also want to be reassured that they will still get a good pension in retirement.
"These proposals strike that balance. And here is our promise to you:
Commenting on reports that the Chancellor will announce the Government's intention to sell Northern Rock, Co-chair of the Liberal Democrat Parliamentary Treasury Committee, Stephen Williams said:
"The most important thing is that taxpayers get value for money from Northern Rock.
"But Northern Rock wasn't the only bank the British people bailed out. I want to make sure we all get something back from RBS and Lloyds too.
"That's why I've proposed giving taxpayers shares in the banks so that we all get a fair share."
"We all know how important the NHS is to the British people.
It isn't just a system; it's isn't just a service. The NHS says something about who we are:
A nation that cares for its citizens when they need it, whatever their means."
"It's a people's health service. Paid for by the people, owned by the people, and dedicated to the people."
"So the NHS debate has never just been about policy. It's about our values, our identity.
That's why there's been so much passion, so much feeling, throughout this listening exercise...
And that should give us all reason to be proud. Because it shows we care."
"Where we do all agree is that the NHS needs to change. For all the reasons David talked about, the question has never been whether to reform. But how to reform. "
"We didn't get that right straight away. So, you told us what to do differently. We listened. And now we have a plan I hope we can all get behind. "
"You told us you were worried about privatisation through the back door.
So we have made that impossible."
"Yes, diversity can drive up quality and increase choice. And the NHS has always had a mix of different providers. But competition will not be encouraged for its own sake, and only where it clearly benefits patients. "
"We're introducing additional safeguards on price competition and cherry-picking. As well as making it illegal, now and in the future, to favour the private sector - or indeed any type of provider over any other. What matters is what works for patients - getting the right provider, doing the best job. "
"You told us the different bits of the NHS need to be better joined up. So we're putting integration at the heart of our reforms. "
"Patients don't like to be sent here, there and everywhere for the same condition. Feeling like no one has a handle on the overall picture. That's why integration will now be at the top of Monitor's agenda. And there'll be a strengthened duty on GPs and other professionals to work closely with other local services, like, crucially, social care. "
"You also told us services should be more accountable to local people. More responsive to local needs. So they will be. "
"GPs are an important part of the answer, but not all of it. That's why we wanted elected councillors to sit on Health and Wellbeing boards. And why we will now be giving those boards much more influence over care provided in their areas. "
"I also strongly welcome the NHS Future Forum's recommendation yesterday. That local commissioning boundaries should not normally cross those of local authorities. Helping us to join up local health and social care services as well. "
"Finally, you told us not to rush. The NHS isn't a machine. You can't flick a switch and turn it on and off. It's a living, breathing part of our lives. The NHS is all of us, millions of us - patients, doctors, nurses. It exists in every single community. At some point it touches every single one of us. "
"Reforming an institution like that takes time. We have to be careful, considered. It's too important to get this wrong."
"So change will happen at the right pace. And that's why the arbitrary deadlines have gone. "
"No switch-on-switch-off date for clinician-led commissioning.
Clinical commissioning groups will only take on responsibility for budgets by April 2013 if they are ready and willing to do so.
If not, the NHS Commissioning Board will do so on their behalf, until they can do it themselves.
No overnight, universal extension of Any Qualified Provider."
Any Qualified Provider gives patients their pick of licensed providers within the NHS. And, where it exists already, it's working well. Providing much greater choice, for example, for hundreds of thousands of patients needing operations every year."
"But we shouldn't pretend it works everywhere. And we should extend it in a more phased, more sensible way."
"And, while we're on deadlines, no rushing the legislation through parliament. We paused the Bill to get this right. Now that we've changed it, the Bill will go back to Committee in the House of Commons. So that MPs - who represent millions of patients - can scrutinise it properly. "
"We've listened, we've learned, and we're improving our plans for the NHS. "
"Yes to patient choice. No to privatisation."
"Yes to giving nurses, hospital doctors and family doctors more say in your care. But no to heavy-handed, top-down restructuring of the NHS. "
"The right reforms - much needed reforms - at the right pace. Evolution, not revolution."
"I want to thank the NHS Future Forum for the excellent report they produced for the three of us.
Professor Field's opening letter is the best description I have read in a long time of everything we cherish about our NHS. As well as the task we face in meeting the challenges ahead. "
"And I want to thank every patient, every clinician, every NHS manager, every nurse who told us where we didn't quite get it right the first time. And where our proposals could be improved."
"I know that many of those people are now eager for us to get on with this. Pausing the legislation was an unusual step. But this is a Government won't take risks with something as important as our NHS."
"And it's a different kind of Government too - a coalition.
Where different voices are heard.
Where we're not afraid to disagree, to have the debate, to bring together the best of our ideas.
That's coalition; that's good government.
It's how you take the right decisions.
And it's how we're protecting our NHS."
"We all know how important the NHS is to the British people.
It isn't just a system; it's isn't just a service. The NHS says something about who we are:
A nation that cares for its citizens when they need it, whatever their means.
"It's a people's health service. Paid for by the people, owned by the people, and dedicated to the people.
"So the NHS debate has never just been about policy. It's about our values, our identity.
That's why there's been so much passion, so much feeling, throughout this listening exercise...
And that should give us all reason to be proud. Because it shows we care.
"Where we do all agree is that the NHS needs to change. For all the reasons David talked about, the question has never been whether to reform. But how to reform.
"We didn't get that right straight away. So, you told us what to do differently. We listened. And now we have a plan I hope we can all get behind.
"You told us you were worried about privatisation through the back door.
So we have made that impossible.
"Yes, diversity can drive up quality and increase choice. And the NHS has always had a mix of different providers. But competition will not be encouraged for its own sake, and only where it clearly benefits patients.
"We're introducing additional safeguards on price competition and cherry-picking. As well as making it illegal, now and in the future, to favour the private sector - or indeed any type of provider over any other. What matters is what works for patients - getting the right provider, doing the best job. "
"You told us the different bits of the NHS need to be better joined up. So we're putting integration at the heart of our reforms.
"Patients don't like to be sent here, there and everywhere for the same condition. Feeling like no one has a handle on the overall picture. That's why integration will now be at the top of Monitor's agenda. And there'll be a strengthened duty on GPs and other professionals to work closely with other local services, like, crucially, social care.
"You also told us services should be more accountable to local people. More responsive to local needs. So they will be.
"GPs are an important part of the answer, but not all of it. That's why we wanted elected councillors to sit on Health and Wellbeing boards. And why we will now be giving those boards much more influence over care provided in their areas.
"I also strongly welcome the NHS Future Forum's recommendation yesterday. That local commissioning boundaries should not normally cross those of local authorities. Helping us to join up local health and social care services as well.
"Finally, you told us not to rush. The NHS isn't a machine. You can't flick a switch and turn it on and off. It's a living, breathing part of our lives. The NHS is all of us, millions of us - patients, doctors, nurses. It exists in every single community. At some point it touches every single one of us.
"Reforming an institution like that takes time. We have to be careful, considered. It's too important to get this wrong.
"So change will happen at the right pace. And that's why the arbitrary deadlines have gone.
"No switch-on-switch-off date for clinician-led commissioning.
Clinical commissioning groups will only take on responsibility for budgets by April 2013 if they are ready and willing to do so.
If not, the NHS Commissioning Board will do so on their behalf, until they can do it themselves.
No overnight, universal extension of Any Qualified Provider."
Any Qualified Provider gives patients their pick of licensed providers within the NHS. And, where it exists already, it's working well. Providing much greater choice, for example, for hundreds of thousands of patients needing operations every year.
"But we shouldn't pretend it works everywhere. And we should extend it in a more phased, more sensible way.
"And, while we're on deadlines, no rushing the legislation through parliament. We paused the Bill to get this right. Now that we've changed it, the Bill will go back to Committee in the House of Commons. So that MPs - who represent millions of patients - can scrutinise it properly.
"We've listened, we've learned, and we're improving our plans for the NHS.
"Yes to patient choice. No to privatisation.
"Yes to giving nurses, hospital doctors and family doctors more say in your care. But no to heavy-handed, top-down restructuring of the NHS.
"The right reforms - much needed reforms - at the right pace. Evolution, not revolution.
"I want to thank the NHS Future Forum for the excellent report they produced for the three of us.
Professor Field's opening letter is the best description I have read in a long time of everything we cherish about our NHS. As well as the task we face in meeting the challenges ahead.
"And I want to thank every patient, every clinician, every NHS manager, every nurse who told us where we didn't quite get it right the first time. And where our proposals could be improved.
"I know that many of those people are now eager for us to get on with this. Pausing the legislation was an unusual step. But this is a Government won't take risks with something as important as our NHS.
"And it's a different kind of Government too - a coalition.
Where different voices are heard.
Where we're not afraid to disagree, to have the debate, to bring together the best of our ideas.
That's coalition; that's good government.
It's how you take the right decisions.
And it's how we're protecting our NHS."
In a keynote speech in Brasilia he announced that more than £2.5bn in bilateral business has been agreed between British and Brazilian companies this year.
