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Baroness Hollis of Heigham: I was slightly taken aback by the Minister's reply. I deal with the first amendment. I hoped I had made it clear that there was no reason why most, if not all, of the costs of that activity could not be recovered by charging for educational facilities. That is part of the wording of the proposed amendment. I am sorry that the noble Lord overlooked that in his wish to denounce the new clause. In other words, there need be no additional cost whatever. Therefore, if this should prove to be self-financing, will he withdraw his objection? Or is his objection wider than that merely of cost? Is it the extension of the activity of the authority itself?

6 p.m.

Lord Mackay of Ardbrecknish: The first part of the amendment states:


That suggests to me that it will pay out some money. Admittedly, subsection (2) says that the authority may make charges. I am not sure whether it would charge the same person it had previously assisted. It would be a little cyclical if that is what it was going to do.

Baroness Hollis of Heigham: That is sophistry. The Minister says that we on this side should be aware of how the burdens on the taxpayer will be mounting, as the clock ticks away like a parking meter, if we add this extra function. I then said to the Minister that the requirement could be self-financing and asked whether he would therefore withdraw his objections. He then said that he did not know whether the charges would meet the cost. Oh, really, that is a pretty sorry reply! That is one issue. We could cover and address the financial point if the Minister were minded to take that on board. He is not. He is scratching around for any points he can make.

The second issue is much more worrying. I think I heard the noble Lord's words correctly. He said that he regards education and research as peripheral. In other words, he wants the regulatory authority to act without the benefit of that education and research. He wants it to act without the knowledge that could be gained by research rather than with it. No one is suggesting that the experienced body which the Minister is setting up under the Bill will be spendthrift or unwise in the activities it finances. Presumably, if it chooses or seeks to finance education and research it will be because to do so will allow the regulatory authority to perform its duties more effectively. What are the Government doing? They are denying the regulatory authority the power to make itself more effective by being better informed.

That is a disgraceful attitude. Every piece of legislation is meant to be informed by research. One thinks of the cost of the Goode Report. One thinks of the cost of the education and research behind the Government's own papers. One thinks of the cost of the

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very valuable research document put out by the Government Actuary a month or so ago which the Minister was kind enough to recommend to me. I refer to the document on the occupational pension schemes. I doubt whether that research was done without the expenditure of several thousands of pounds. In other words, the Government recognised the need to have their judgments based as far as possible on education and research. However, when it comes to the regulatory authority, we are told that we should not have such a benefit. Instead, presumably, decisions should be based either on the experience of the members or on hunch and instinct. If the Minister wants to ensure that the regulatory authority gets the backs up of the members of the industry which is funding it by appearing to be ill informed, the Government's rejection of the amendment is a sure way to do so.

Baroness Seear: I find it odd that the Minister did not in any way answer the point about the backing of cases where an issue of principle is involved. The Minister surely knows that with the Equal Opportunities Commission—it may not be his favourite organisation—and the developments that have spread as a result of the Sex Discrimination Act, the taking to the courts of cases which are complex and difficult and to which the answer is not apparent to get the issues clarified has been of the greatest assistance. The Minister must at least agree that this is not the most straightforward and simple Bill that has ever come before your Lordships' House and that not everyone will realise at once what this subject means. The authority may well need to take cases in order to have the position clarified. That is all we are asking for in the amendment. Surely the Minister can concede that.

Baroness Hollis of Heigham: I support the noble Baroness, Lady Seear, on the second of the amendments. That is precisely the point. Because the Minister refuses, by rejecting the first amendment to clarify on the face of the Bill what the duties, functions, purposes and powers of the regulator are, individuals may seek or need to have that clarification through the courts. But the regulator cannot help finance what may need to be tested in the courts—the very definition and function of its powers. That is an absurd and perverse position for the Minister to be in: to deny the right of the authority to be conjoined in legal action where the authority judges that it is in its own interests to be so conjoined. It is not a duty on the authority; it is a permission, where it thinks it appropriate and in the public interest, that that point of law should be tested. We know that the private individual cannot afford to do it.

Why is the Minister failing to specify what the regulatory authority may do and then failing to allow us some very specific powers—education and research on the one hand and the power to clarify its functions, duties and responsibilities in court on the other? Why are the Government seeking to tie the hands of the regulatory authority, which the Government are resting on to deliver the pension promise? We are trying not to be suspicious of some deep laid plot. However, every

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amendment for clarity, strengthening or for independence of the regulator, even when it has virtually nil cost, the Government are resisting. The only message that emerges is that the Government are not seeking to strengthen the regulator. On the contrary, the Government would not be unhappy if many of its powers and functions in practice were subverted. We shall come back to this matter. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendment No. 19 not moved.]

Clause 3 [Removal or suspension of trustees]:

[Amendment No. 20 not moved.]

Lord Lucas moved Amendment No. 21:


Page 2, line 20, leave out ("this Part or") and insert:
("(a) this Part, other than the following provisions: sections 44 to 47, 55 to 58 and 100 to 102, or
(b)") .

The noble Lord said: This amendment excludes from OPRA's jurisdiction obligations introduced under Clauses 44 to 48, 55 to 59 and 100 to 102 covering, respectively, indexation, equal treatment and the provision of information to the Pensions Compensation Board. As currently drafted, Clause 3 brings them within the authority's jurisdiction. That was never the intention. Problems over indexation and equal treatment are best left to the ombudsman, industrial tribunals and the courts. The compensation board will be best placed to enforce the requirements to provide it with information. I beg to move.

Lord McIntosh of Haringey: I listened with care to what the noble Lord said in support of the amendment but I remain very puzzled by it. If it had been argued that the powers which would exist to control pensions by the removal of trustees of pension schemes existed somewhere else, then one would be more sympathetic to it. But these are very wide areas of possible infringement of the pension provisions. They cover price indexation, which many people in pension schemes agree with. I, as the beneficiary of a price indexed pension scheme, believe it is enormously important. They cover the rules about equal treatment, which are widely believed to be of great importance. They also cover the issue of the supply of information to the PCB.

All of these matters are central to the effective supervision by the authority of individual pension schemes. Yet the noble Lord says that they should be taken out of the powers of supervision and dealt with by the ombudsman or by industrial tribunals. Surely that is a misuse of the ombudsman and industrial tribunals. The ombudsman is the person to go to as a matter of last resort. The ombudsman should not be deluged by day-to-day matters of the supervision of individual pensions schemes. We welcome the earlier amendment which brought the ombudsman into it, but if there are 150,000 schemes there could be thousands of references to the ombudsman; in other words, the whole of the duties of the parliamentary commissioners could be subverted by this new responsibility.

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Is it really the most efficient way of dealing with a regulation of this kind for it to be dealt with within an industrial tribunal? We all know what the delays are in those bodies and what the costs are to the public purse. I suggest that the Government consider that an ombudsman or industrial tribunal is not the right locus for the day-to-day supervision of individual pensions schemes. The authority is the right place for supervision because it is more direct and immediate. It is also a good deal cheaper than the alternative which the noble Lord has suggested. The Bill as it stands is better without this amendment.


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