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Baroness Hollis of Heigham: Again I am somewhat baffled by the Minister's reply. I took down his words. He said that he thinks codes of practice are a valuable supplement to legislation but should not replace it. I believe those were among his opening remarks. But his previous objections to Amendments Nos. 1 and 7 comprised a rejection of precisely that—that is, that the functions of the regulator, within which the trustees

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would be expected to act, should be on the face of the Bill—even though there is plenty of experience from the Irish law and from the Australian law that that is an entirely practicable operation. On the one hand, the Minister is refusing to have the functions and duties of the regulator specified so that the trustees know within which framework to act and when in that case they should whistle-blow. But, on the other hand, he is apparently rejecting, except in the vaguest terms possible, the alternative, which is that the regulator should be required to issue precise codes of guidance to make up that shortfall in the legislation.

Which is it that the Minister is going to have? He really must either give us a description and a definition of the powers, functions and duties of the regulator or, alternatively, require on the face of the Bill that the regulator should offer that to the trustees. He has to do one or the other; otherwise what we have is a board, penalties and some miscellaneous clauses, and we must hope that some 150,000 schemes, with all their elected trustees, will make sense of it, monitor it, act as whistle-blowers and safeguard the pension promise. They cannot do it. Therefore I ask the Minister to think again. If he is determined to resist what we think would be the preferable first step, which is to specify what it is the regulator is expected do, so that everybody knows that—for some reason the Government do not want them to know—then he should at the very least require the regulator to make his position clear by issuing codes of guidance as required by this amendment. I invite the Minister to comment.

4.45 p.m.

Lord Mackay of Ardbrecknish: I think I have already made all the comment I wish to make. Anyone who reads the Bill, and the part of the Bill that concerns the regulator, will very quickly understand the powers and responsibilities that have been conferred on the regulator. I do not think that that is a mystery. Despite the best efforts of the noble Baroness, I do not think that there is anything mysterious about that. I do not think that there is some deep plot that she can work out. Any sensible person who understands his way round legislation will be able to see very clearly what the powers, duties and responsibilities of the regulator will be.

As I said, as regards codes of practice, the pensions professionals and the administrators are working on such codes of practice. We believe that they have an important part to play. As I explained, the authority has the power in Schedule 1 to act along the lines the Committee would like as regards codes of practice. However, as I say, I do not believe it is necessary to have statutory codes of practice and go through the parliamentary hoops which would be required to have them approved and, of course, then to have them changed. I believe the nature of codes of practice is quite different.

Baroness Hollis of Heigham: Again, I am disappointed. The Minister said that any sensible person can see very clearly—those were his words—what the regulator will do. Every Member of the Committee has the Bill and every Member here present will have been

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looking at the amendments and listening to the debate. I wonder how many could confidently assert, having read the Bill and listened to the debate, that they know what the regulator will do. I am talking about Members of the Committee who have had the benefit of studying the Bill and listening to the Minister's response. If the Committee cannot assert that it knows what the regulator will do—I think, speaking for our Benches, that many of us would say that we could not do that—how do the Government expect the members and trustees of 150,000 schemes to have that clarity that the Minister thinks any sensible person would have?

I have still not received from the Minister an explanation as to why he refuses to make clear what is opaque. If the information is redundant, what does it matter? If it is necessary, it is vital. We can only assume not that there is a plot but that the Government prefer to keep the regulation of the pensions industry in the shadows. If that is so, we are surely inviting a continuing array of frauds and problems—not necessarily a Maxwell case, because we would all accept that nothing can stop a Maxwell—based on a misunderstanding because the Government have refused to do what we asked them to do. We asked them to clarify the position so that sensible people, including Members of this Chamber, know what the regulator is expected to do and therefore know their obligations under the scheme and when to blow the whistle.

Lord Boyd-Carpenter: I am grateful to the noble Baroness for giving way. I should like to know what it is she is asking the Committee to do. The first subsection of the amendment states that the authority "may" issue codes of guidance, while the second subsection refers to a duty to issue codes of guidance. Is it voluntary or compulsory?

Baroness Hollis of Heigham: I am glad that the noble Lord, Lord Boyd-Carpenter, asked that question. The second subsection refers to the duties under which the regulator will be required to issue a code of guidance, while the first subsection allows the regulator to add additional codes of guidance. Therefore, the second subsection is the subset within the first. The regulator has a general power and is required to exercise it on specific items. I hope that that clarifies the matter.

We shall obviously return to the issue. It is distressing that on an issue as technical, complicated and detailed as this Pensions Bill, as the Minister himself will be the first to admit, when the Minister has constantly been invited from these Benches to clarify the Bill—whether through the first amendment, Amendment No. 7, or Amendment No. 8—he has refused to do so and rejected the amendments. I very much hope that if his noble friends behind him share our concern, and if they too remain mystified as to exactly what the regulator will do and what newly appointed trustees will be expected to do, they will make representations to their noble friend the Minister. For the moment, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

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Schedule 1 [Occupational Pensions Regulatory Authority]:

Baroness Turner of Camden moved Amendment No. 9:


Page 94, line 10, at end insert:
(" . The assistance of the Authority may be invoked by the trustees of an occupational pension scheme coming within the scope of this Act, a trade union representing members of such a scheme, the employer, an individual member or members of the scheme or their dependants, the Occupational Pensions Advisory Service (OPAS), the Pensions Ombudsman established under this Act, or the Secretary of State, and the Authority is required to investigate such requests for assistance unless it can show good reason why it should not.").

The noble Baroness said: Amendment No. 9 deals with the issue of persons who may invoke the assistance of the regulator. The intention of the amendment is to spell out exactly who may invoke the assistance of the regulator since that is nowhere stated precisely in the Bill. Clearly, the trustees of a scheme should be able to do so if they feel that matters are not as they should be. On the other hand, an individual member may come by some knowledge which he may acquire as an employee or in some other way. If he feels that the interests of scheme members are at risk he should be entitled to go to the regulator. Should he die in the meantime it should be open to his dependants to continue with the quest.

There are already organisations which are active within the pensions field, some of whose functions have been to provide advice and assistance to individual members. There is the Occupational Pensions Advisory Service (OPAS), which provides a service without charge to individuals concerned about pensions issues affecting them personally. I am currently a member of the OPAS board. That body has now been recognised by the Government and receives funding from public funds via the Occupational Pensions Board. It does a very useful job, and it is likely that from time to time OPAS advisers may come across something that causes them to question the administration of a particular scheme. The same is true of the pensions ombudsman. Incidentally, OPAS and the ombudsman occupy different floors in the same building, so there is a connection between them. All those bodies, together with trade unions representative of members within a scheme, should be able to trigger an investigation by the regulator.

Again, the public knowledge that all those people could invoke an investigation could deter wrongdoing. I hope that the Minister will agree that this is a sensible amendment and will agree to its inclusion—or, if not this wording, then something like it—on the face of the Bill. I beg to move.

Baroness Seear: I rise in the hope that this time the Minister will agree with us. It is a faint hope, but hope springs eternal.

The Minister is anxious that the regulator should not be burdened with always taking the initiative but that whistles should blow to alert him that something needs to be done. In the amendment we spell out who may blow the whistle.

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In an earlier debate I said that I did not wish the regulator to have to rely on whistle-blowing. We shall have a more detailed discussion about that on a later amendment. However, the fact that I do not want the regulator to have to rely on whistle-blowing is not the same as saying that I do not want people to blow the whistle. That is a quite different matter. It is clear that anybody who is worried that something is going wrong should be able to alert the regulator to it so that he can then exercise the monitoring function that the Minister is so afraid will be too much for the regulator. He will certainly be helped if all the people mentioned in the amendment have the authority to go to the regulator if they are worried.

I stress that those people would act if they were worried. It is not a matter of where something has obviously gone wrong. It has been said repeatedly in discussions about the Bill that the regulator needs to come in not when things have gone drastically wrong but when there is a suspicion that things may be going wrong. It is at that point that the people listed in the amendment—who are in a very good position to do so—should alert the regulator to the fact that there may be something that needs to be investigated. I hope that on this occasion the Minister will be able to accept the amendment.


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