House of Commons Amendments

Session 2014 - 15
Internet Publications
Other Bills before Parliament

Public Bill Committee:
66

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Steve Webb

NC4

To move the following Clause—

“Pension sharing and normal benefit age

(1)
The Pension Schemes Act 1993 is amended as follows.

(2)
In section 101B (interpretation), for the definition of “normal benefit age”

substitute—

““normal benefit age”, in relation to a pension credit benefit for a member

of a scheme, is the earliest age at which the member is entitled to receive

the benefit without adjustment for taking it early or late (disregarding any

special provision as to early payment on the grounds of ill-health or

otherwise);

“normal pension age”, in relation to a benefit for a member of a scheme,

means the earliest age at which the member is entitled to receive the

benefit without adjustment for taking it early or late (disregarding any

special provision as to early payment on the grounds of ill-health or

otherwise);”.

(3)
In section 101C (basic principle as to pension credit benefit), for subsection (1)

substitute—

“(1)
The normal benefit age in relation to a pension credit benefit for a

member of a scheme—

(a)
must not be lower than 60, and

(b)
must not be higher than the permitted maximum.

(1A)
The “permitted maximum” is 65 or, if higher, the highest normal pension

age for any benefit that is payable under the scheme to or in respect of

any of the members by virtue of rights which are not attributable (directly

or indirectly) to a pension credit.””

Member’s explanatory statement

This amendment allows schemes to increase beyond 65 the age at which a pension shared on

divorce can first be put into payment but only if the scheme has a normal pension age above 65 for

any benefits payable under the scheme.

Steve Webb

NC5

To move the following Clause—

“Duty to act in the best interests of members

(1)
Regulations may impose a duty on the managers of a relevant non-trust based

scheme to act in the best interests of members when taking decisions of a

specified description.

(2)
In this section “relevant non-trust based scheme” means a non-trust based scheme

that is—

(a)
a shared risk scheme, or

(b)
a defined contributions scheme under which any of the benefits that may

be provided are collective benefits.

(3)
Regulations under this section—

Public Bill Committee:
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(a)
may provide for the duty to act in the best interests of members to

override obligations that are inconsistent with that duty (including

obligations imposed by any instrument, enactment or rule of law), but

(b)
do not otherwise affect any duty that might arise apart from this section.

(4)
Regulations under this section may provide for the consequences of a manager

breaching (or threatening to breach) the duty to act in the best interests of

members to be the same as the consequences of breaching (or threatening to

breach) a fiduciary duty owed by the manager to the members and, accordingly,

for the duty to be enforceable in the same way as a fiduciary duty.

(5)
In this section—

“collective benefit” has the meaning given by section 19;

“defined contributions scheme” has the meaning given by section 4;

“non-trust based scheme” means a scheme that is not established under a

trust;

“shared risk scheme” has the meaning given by section 3.”

Member’s explanatory statement

This amendment inserts a new power to make regulations which may impose a duty on managers

of non-trust based schemes to act in members’ best interests when taking certain specified

decisions. This duty may apply in relation to shared-risk schemes and schemes providing collective

benefits.

Steve Webb

NC6

To move the following Clause—

“Collective benefits exempt from indexation

(6)
In section 51 of the Pensions Act 1995 (annual increase in rate of pension)—

(a)
in subsection (1), for “Subject to subsections (6) and (7)” substitute

“Subject to subsections (6) to (7A)”;

(b)
after subsection (7) insert—

“(7A)
This section does not apply to any pension, or part of a pension,

that is a collective benefit.”

(7)
Omit section 21(2) of the Pensions Act 2011, which is no longer needed given

subsection (1).”

Member’s explanatory statement

This text is taken from paragraphs 1 and 2 of Schedule 4 to the Bill, which is left out by amendment

40. The effect is unchanged.

Public Bill Committee:
68

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Steve Webb

NC7


To move the following Clause—

“Investment powers

(1)
Regulations may make provision about—

(a)
the investment powers of the trustees or managers of a pension scheme

in connection with collective benefit investments;

(b)
their powers to delegate decisions in connection with collective benefit

investments (including provision as to liability for delegated decisions);

(c)
the investment powers of any person to whom they have delegated

decisions in connection with collective benefit investments.

(2)
The regulations may, in particular—

(a)
make provision corresponding or similar to any provision made by

section 34 or 36 of the Pensions Act 1995 (powers of investment and

delegation and choice of investments for occupational trust-based

schemes);

(b)
disapply those sections in relation to collective benefit investments.”

Member’s explanatory statement

This replaces clause 24 (which is left out by amendment 45) and contains additional material

about investment powers in relation to collective benefits.

Steve Webb

NC8


To move the following Clause—

“Restriction on borrowing by trustees or managers

(3)
Regulations may prohibit a person to whom this section applies from borrowing

money or acting as a guarantor except in specified cases.

(4)
This section applies to—

(a)
the trustees or managers of a pension scheme under which any of the

benefits that may be provided are collective benefits, and

(b)
any person to whom they have delegated decisions about collective

benefit investments.”

Member’s explanatory statement

Section 36A of the Pensions Act 1995 contains a similar power in respect of occupational trust-

based schemes.

Steve Webb

NC9


To move the following Clause—

“Investment powers: duty of care

(5)
Regulations may make provision to prevent any instrument or agreement from

excluding or restricting any liability of the trustees or managers of a pension

Public Bill Committee:
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scheme, or any person to whom they have delegated decisions, in respect of the

performance of investment functions involving collective benefit investments.

(6)
The regulations may, in particular—

(a)
make provision corresponding or similar to any provision made by

section 33 of the Pensions Act 1995 (duty of care in respect of investment

powers for occupational trust-based schemes);

(b)
disapply that section in relation to collective benefit investments.”

Member’s explanatory statement

This amendment outlines a new regulation-making power to prevent liability being restricted in

respect of investment functions in schemes offering collective benefits. The regulations may make

corresponding or similar provision to section 33 of the Pensions Act 1995.

Steve Webb

NC10


To move the following Clause—

“Payment of amounts out of collective benefit funds

(7)
Regulations must prohibit the making of payments out of funds held for the

purposes of providing collective benefits except for—

(a)
payments made for the purpose of providing those benefits, or

(b)
other specified payments.

(8)
The regulations may, in particular, make provision corresponding or similar to

any provision made by section 37 of the Pensions Act 1995 (payment of surplus

to employer in the case of an occupational trust-based scheme).”

Member’s explanatory statement

The amendment requires regulations to be made preventing payments being made out of funds held

for the purposes of providing collective benefits subject to specified exceptions.

Steve Webb

NC11


To move the following Clause—

“Regulations under Part 3: overriding requirements

Regulations under this Part may include provision for them to override the

provisions of a pension scheme to the extent that there is a conflict.”

Member’s explanatory statement

The amendment allows regulations to override the scheme rules in cases where there is a conflict.

Public Bill Committee:
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Steve Webb

NC12


To move the following Clause—

“Pensions guidance

Schedule (Pensions Guidance) contains amendments of the Financial Services

and Markets Act 2000, and of other legislation, that are about the giving of

pensions guidance to pension scheme members with a right or entitlement to cash

balance benefits or other money purchase benefits.”

Member’s explanatory statement

This amendment introduces the Schedule inserted by amendment NS2.

New Schedule

Steve Webb

NS1

To move the following Schedule—

“Amendments to do with section (Pension Scheme for Fee-Paid Judges)

Pensions (Increase) Act 1971 (c. 56)

1
The Pensions (Increase) Act 1971 is amended as follows.

2
In section 19(2)(a) (extent to Northern Ireland)—

(a)
after “or section” insert “18A or”, and

(b)
after “section 10 of that Act” insert “or provision made under section

18A of that Act that is corresponding or similar to the provision that

may be made by regulations under section 10 of that Act”.

3
In Schedule 2 (official pensions), after paragraph 4A insert—

“4AA
A pension payable under a scheme made under section 18A of the

Judicial Pensions and Retirement Act 1993, other than a pension

payable under or by virtue of provision that is corresponding or

similar to the provision that may be made by regulations under

section 10 of that Act.”

Judicial Pensions and Retirement Act 1993 (c. 8)

4
The Judicial Pensions and Retirement Act 1993 is amended as follows.

5
In section 22 (application of the Pensions (Increase) Act 1971 to Northern

Ireland), in subsection (2)—

(a)
after “shall include” insert “—

(a)
”;

(b)
at the end insert “; and

(b)
pensions payable under a scheme made under section

18A above, other than pensions payable under or by

virtue of provision that is corresponding or similar to

the provision that may be made by regulations under

section 10 above.”

6    (1)
Section 28 (funding arrangements) is amended as follows.,

Public Bill Committee:
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      (2)
In subsection (2) (benefits payable out of money provided by Parliament), after

paragraph (a) (but before the “and” at the end) insert—

“(aa)
any pension or other benefits payable under a scheme made

under section 18A above;”.

      (3)
In subsection (7), for “section 10 above” substitute “—

(a)
section 10 above, or

(b)
provision made under section 18A above that is

corresponding or similar to the provision that may be made by

regulations under section 10 above.”

7
In section 28A (contributions in respect of Northern Ireland judges), at the end

insert “or as a fee-paid judge in Northern Ireland (within the meaning given by

section 18A)”.”

Member’s explanatory statement

These amendments in this new Schedule relate to the pension scheme for fee-paid judges - see

amendment NC3. Among other things, they deal with inflation increases.

Steve Webb

NS2


To move the following Schedule—

“Pensions Guidance

8
The Financial Services and Markets Act 2000 is amended as follows.

9
After section 333 insert—

“Part 20A

Pensions Guidance

333A
Introduction and definitions

(1)
This Part is about the giving of pensions guidance.

(2)
“Pensions guidance” means guidance given for the purpose of helping

a member of a pension scheme to make decisions about what to do

with the cash balance benefits or other money purchase benefits that

may be provided to the member.

(3)
In this Part—

“cash balance benefits” has the meaning given by section 152(5) of the

Finance Act 2004;

“money purchase benefits” has the meaning given by section 152(4) of

the Finance Act 2004;

“pensions guidance” has the meaning given by subsection (2);

“pension scheme” has the meaning given by section 150(1) of the

Finance Act 2004.

Public Bill Committee:
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Giving of pensions guidance

333B
Treasury’s role in relation to pensions guidance

(1)
The Treasury must take such steps as they consider appropriate to

ensure that people have access to pensions guidance.

(2)
The Treasury may—

(a)
seek to increase awareness of the availability of the guidance;

(b)
undertake or commission research relating to the giving of the

guidance.

333C
Giving of pensions guidance

(1)
The bodies listed in subsection (2) are to give pensions guidance in

accordance with arrangements made with the Treasury.

(2)
Those bodies are—

(a)
the Pensions Advisory Service Limited;

(b)
the National Association of Citizens Advice Bureaux;

(c)
the Scottish Association of Citizens Advice Bureaux;

(d)
the Northern Ireland Association of Citizens Advice Bureaux.

(3)
The bodies listed in subsection (2) may give pensions guidance by

arranging for it to be given by another person (including another listed

body).

(4)
The National Association of Citizens Advice Bureaux, the Scottish

Association of Citizens Advice Bureaux and the Northern Ireland

Association of Citizens Advice Bureaux may jointly carry out their

functions of giving pensions guidance.

(5)
The Treasury may by regulations repeal one or more of paragraphs (a)

to (d) of subsection (2).

(6)
Regulations under subsection (5) may make consequential

amendments of this Act.

333D
Financial assistance to bodies involved in giving pensions guidance

(1)
The Treasury may make grants or loans or give any other form of

financial assistance to—

(a)
the Pensions Advisory Service Limited;

(b)
the Northern Ireland Association of Citizens Advice Bureaux.


(For the power to make grants to the National Association of Citizens

Advice Bureaux and the Scottish Association of Citizens Advice

Bureaux see section 40A of the Consumers, Estate Agents and Redress

Act 2007.)

(2)
Any grant, loan or other form of financial assistance under subsection

(1)—

(a)
is to be made or given for the purpose of enabling the body to

carry out its functions under section 333C(1), and

(b)
may be made or given subject to such other terms as the

Treasury consider appropriate.

(3)
Any expenses incurred by the Treasury under this section are to be met

out of money provided by Parliament.



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