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19

 

House of Commons

 
 

Tuesday 6th February 2007

 

Public Bill Committee Proceedings

 

Pensions Bill


 

[ninth and tenth sittings]


 

Mr Nigel Waterson

 

Andrew Selous

 

Mr Mark Lancaster

 

Withdrawn  16

 

Schedule  6,  page  59,  line  13,  leave out from ‘contain’ to ‘of’ in line 14 and insert ‘a

 

majority of persons who are either members or employees’.

 

Mr Nigel Waterson

 

Andrew Selous

 

Mr Mark Lancaster

 

Not called  17

 

Schedule  6,  page  59,  line  18,  leave out paragraph 10.

 

Mr Nigel Waterson

 

Andrew Selous

 

Mr Mark Lancaster

 

Not called  14

 

Schedule  6,  page  59,  line  20,  at end insert—

 

‘10A (1)  

The Authority must establish a committee for the purpose of representing the

 

interests of scheme members and prospective scheme members.

 

      (2)  

The chairman of the committee must be a consumer representative appointed

 

under paragraphs 1(1)(b) and 1(3A).’.

 

Mr Nigel Waterson

 

Andrew Selous

 

Mr Mark Lancaster

 

Withdrawn  18

 

Schedule  6,  page  62,  line  28,  at end insert—

 

‘18A      

Such grants shall be classified as—

 

(a)    

policy grants; or

 

(b)    

operational grants.

 

18B(1)  

Policy grants shall be used in support of the Authority’s work on advising on

 

preparing for the implementation of, or the modification of, any relevant

 

proposals about personal accounts.

 

      (2)  

Policy grants shall not be made more than two years after the commencement

 

of this Act.


 
 

Public Bill Committee Proceedings: 6th February 2007      

20

 

Pensions Bill, continued

 
 

18C      

Operational grants shall be used in support of the Authority’s work in

 

preparing for the implementation of proposals for personal accounts.’.

 

Mr Nigel Waterson

 

Andrew Selous

 

Mr Mark Lancaster

 

Not called  19

 

Schedule  6,  page  62,  line  34,  at end insert—

 

  ‘(2A)  

A statement under sub-paragraph (1)(b) must show separately the purposes to

 

which policy grants and operational grants have been applied.

 

    (2B)  

A statement under sub-paragraph (1)(b) must show the interest charges that

 

would have accrued on the operational grants if they had been loans taken out

 

at commercial rates of interest.’.

 

Schedule Agreed to.

 


 

Mr Nigel Waterson

 

Andrew Selous

 

Mr Mark Lancaster

 

Withdrawn  83

 

Clause  19,  page  20,  line  35,  leave out ‘appropriate’ and insert ‘strictly necessary’.

 

Mr Nigel Waterson

 

Andrew Selous

 

Mr Mark Lancaster

 

Not called  84

 

Clause  19,  page  21,  line  2,  leave out from ‘State’ to ‘which’ in line 3.

 

Mr Nigel Waterson

 

Andrew Selous

 

Mr Mark Lancaster

 

Not selected  85

 

Clause  19,  page  21,  line  5,  leave out ‘pensions’.

 

Mr Nigel Waterson

 

Andrew Selous

 

Mr Mark Lancaster

 

Not called  20

 

Clause  19,  page  21,  line  11,  at end insert—

 

‘(2A)    

It shall be the duty of the Authority to carry out their functions under subsection

 

(1) in such manner as—

 

(a)    

appears to them to ensure, so far as they are facilitating the

 

implementation of any such proposals, that there is effective co-operation

 

in relation to the implementation of the proposals between themselves,

 

the Pensions Regulator, the Financial Services Authority and the

 

Secretary of State; and

 

(b)    

does not interfere with the existing provision of personal or occupational

 

schemes.’.


 
 

Public Bill Committee Proceedings: 6th February 2007      

21

 

Pensions Bill, continued

 
 

Mr David Laws

 

Lorely Burt

 

Not called  40

 

Clause  19,  page  21,  line  11,  at end insert—

 

‘(2A)    

In discharging its functions under this Part, the Authority shall publish a report on

 

how it can ensure that individuals who have money invested in Personal Accounts

 

and those considering doing so in future will have access to generic financial

 

advice.’.

 

Mr Nigel Waterson

 

Andrew Selous

 

Mr Mark Lancaster

 

Not called  86

 

Clause  19,  page  21,  line  26,  leave out subsection (5).

 

Mr Nigel Waterson

 

Andrew Selous

 

Mr Mark Lancaster

 

Not called  21

 

Clause  19,  page  21,  line  27,  at end insert—

 

‘(5A)    

In discharging its function under this section, the Authority shall ensure that its

 

actions and advice support the following objectives for the scheme—

 

(a)    

ensuring that the overall outcome, taking account of the impact on the

 

existing market, is an increase in the number of people saving and the

 

overall amount being saved;

 

(b)    

optimising levels of participation and contribution among the target

 

group;

 

(c)    

setting an investment strategy in the best interests of members;

 

(d)    

minimising burdens on employers;

 

(e)    

minimising the impact on other high-quality pension provision;

 

(f)    

assuring security of administration;

 

(g)    

governing in the best interests of members and beneficiaries;

 

(h)    

ensuring that the board acts impartially, prudently, responsibly and

 

honestly;

 

(i)    

delivering appropriate levels of choice;

 

(j)    

achieving charges that are fair and reasonable;

 

(k)    

ensuring the funds are invested in the best interests of the members.

 

(5B)    

Her Majesty may from time to time by Order in Council make provision for

 

amending the objectives set out in subsection (5A).

 

(5C)    

No recommendation shall be made to Her Majesty to make an Order in Council

 

under subsection (5B) above unless a draft of the Order has been approved by

 

resolution of each House of Parliament.’.

 

Mr Nigel Waterson

 

Andrew Selous

 

Mr Mark Lancaster

 

Not called  22

 

Clause  19,  page  21,  line  27,  at end insert—

 

‘(5A)    

In making preparations and giving advice, the Authority shall seek to ensure that

 

the full costs of setting up and operating the scheme are covered by charges to be

 

made either to employers or to members and not met from other sources.’.


 
 

Public Bill Committee Proceedings: 6th February 2007      

22

 

Pensions Bill, continued

 
 

Mr Nigel Waterson

 

Andrew Selous

 

Mr Mark Lancaster

 

Not called  87

 

Clause  19,  page  21,  line  29,  at end insert ‘, and such guidance must be reported to

 

Parliament by an oral statement made by the Secretary of State.’.

 

Mr Nigel Waterson

 

Andrew Selous

 

Mr Mark Lancaster

 

Not called  23

 

Clause  19,  page  21,  line  31,  at end insert—

 

‘(7A)    

Before issuing guidance under subsection (6) the Secretary of State shall

 

consult—

 

(a)    

the Authority;

 

(b)    

organisations appearing to him to be representative of consumers;

 

(c)    

organisations appearing to him to be representative of employees;

 

(d)    

organisations appearing to him to be representative of employers;

 

(e)    

organisations appearing to him to be representative of the financial

 

services industry;

 

(f)    

such other persons as the Secretary of State considers it appropriate to

 

consult in relation to the guidance.

 

(7B)    

A draft of any guidance proposed to be issued under this section shall be laid

 

before each House of Parliament.

 

(7C)    

Guidance shall not be issued under this section until after the period of forty days

 

beginning with—

 

(a)    

the day on which the draft is laid before each House of Parliament; or

 

(b)    

if the draft is laid before the House of Lords on one day and the House of

 

Commons on another, the later of those two days.

 

(7D)    

If, before the end of that period, either House resolves that the guidance should

 

not be issued, the Secretary of State must not issue it.

 

(7E)    

In reckoning any period of forty days for the purposes of subsection (7C) or (7D),

 

no account shall be taken of any time during which—

 

(a)    

Parliament is dissolved or prorogued, or

 

(b)    

both Houses are adjourned for more than four days.

 

(7F)    

The Secretary of State shall arrange for any guidance issued under this section to

 

published in such manner as he considers appropriate.’.

 

Mr David Laws

 

Lorely Burt

 

Not called  38

 

Clause  19,  page  21,  line  32,  at end add—

 

‘(9)    

Prior to Parliament’s approval of proposals the Authority must evaluate the effect

 

of means testing on levels of saving in personal accounts and its impact on returns

 

in personal accounts and thereafter conduct and publish evaluations annually.’.

 

Mr David Laws

 

Lorely Burt

 

Not called  39

 

Clause  19,  page  21,  line  32,  at end insert—

 

‘(9)    

The Authority shall carry out a gender impact assessment of relevant proposals

 

regarding saving in personal accounts as specified in subsection (2).’.


 
 

Public Bill Committee Proceedings: 6th February 2007      

23

 

Pensions Bill, continued

 
 

Mr David Laws

 

Lorely Burt

 

Not called  65

 

Clause  19,  page  21,  line  32,  at end add—

 

‘(9)    

The Authority shall, no later than 1st April 2008, publish a strategy for

 

maximising participation in the new system of personal accounts in which it

 

shall—

 

(a)    

set out and give full explanation of targets for participation in personal

 

accounts;

 

(b)    

identify at-risk groups where auto-enrolment might risk very low rates or

 

return;

 

(c)    

outline contingency plans for coping with the workload if participation is

 

higher than expected;

 

(d)    

outline its strategy for maximising the participation among employees in

 

small businesses.’.

 

Mr David Laws

 

Lorely Burt

 

Not called  66

 

Clause  19,  page  21,  line  32,  at end add—

 

‘(9)    

The Authority shall prepare and publish a report, no later than 1st April 2008, on

 

measures it proposes to take to monitor the impact of the new personal accounts

 

scheme on existing occupational pensions provision and to guard against

 

levelling down.’.

 

Mr David Laws

 

Lorely Burt

 

Not called  67

 

Clause  19,  page  21,  line  32,  at end add—

 

‘(9)    

The Authority shall prepare and publish a report, no later than 1st April 2008, on

 

how it plans to establish and develop any necessary IT system and reduce risks of

 

IT problems with personal accounts.’.

 

Mr David Laws

 

Lorely Burt

 

Not called  68

 

Clause  19,  page  21,  line  32,  at end add—

 

‘(9)    

The Authority shall prepare and publish a report, no later than 1st April 2008, on

 

the percentage of the target audience of personal accounts expected to accrue

 

returns from saving in personal account pension schemes of—

 

(a)    

more than 100 per cent,

 

(b)    

0-100 per cent, and

 

(c)    

less than 0 per cent.’.

 

Clause Agreed to.

 



 
 

Public Bill Committee Proceedings: 6th February 2007      

24

 

Pensions Bill, continued

 
 

Mr Nigel Waterson

 

Andrew Selous

 

Mr Mark Lancaster

 

Withdrawn  79

 

Clause  20,  page  21,  line  36,  leave out ‘the Authority thinks appropriate’ and insert

 

‘shall be specified in regulations’.

 

Mr Nigel Waterson

 

Andrew Selous

 

Mr Mark Lancaster

 

Not called  80

 

Clause  20,  page  21,  line  38,  leave out subsection (2).

 

Clause Agreed to.

 

Clauses 21 to 23 Agreed to.

 


 

James Purnell

 

Agreed to  56

 

Clause  24,  page  23,  line  25,  leave out subsection (3) and insert—

 

‘(3)    

The following repeals have effect at the end of the period of 2 months beginning

 

with the day on which this Act is passed—

 

(a)    

the repeals in Part 2 of Schedule 7 of the provisions of the Pensions Act

 

1995 (c. 26) other than paragraphs 19 and 20 of Schedule 4 to that Act;

 

(b)    

the repeal in Part 2 of Schedule 7 of paragraph 36 of Schedule 24 to the

 

Civil Partnership Act 2004 (c. 33);

 

(c)    

the repeals in Part 3A of Schedule 7.’.

 

Clause, as amended, Agreed to.

 


 

James Purnell

 

Agreed to  60

 

Schedule  7,  page  66,  line  8,  at end insert—

 

‘Part 3A

 

Additional pension: simplified accrual rates

 

Citation

Extent of repeal

 
 

Social Security Contributions and

In section 39—

 
 

Benefits Act 1992 (c. 4)

(a)    

the words “and Schedule 4A” wherever

 
  

occurring;

 
  

(b)    

subsection (3).

 
  

In Schedule 4A, in paragraph 1(2) “39(1),”.

 
 

Child Support, Pensions and Social

Section 35(3).’.

 
 

Security Act 2000 (c. 19)

  

 
 

Public Bill Committee Proceedings: 6th February 2007      

25

 

Pensions Bill, continued

 
 

 

Mr Nigel Waterson

 

Andrew Selous

 

Mr Mark Lancaster

 

Not called  7

 

Schedule  7,  page  66,  line  27,  at end insert—

  

‘Section 28.’.

 
 

Schedule, as amended, Agreed to.

 

Clauses 25 to 29 Agreed to.

 


 

NEW CLAUSES

 

Report by Government Actuary on trends in longevity

 

Mr Nigel Waterson

 

Andrew Selous

 

Mr Mark Lancaster

 

Not called  NC1

 

To move the following Clause:—

 

‘(1)    

Beginning in April 2014, the Government Actuary shall present a Report to

 

Parliament every five years setting out the latest evidence on trends in longevity.

 

(2)    

It shall be the duty of the Secretary of State to make a motion in the House of

 

Commons in relation to any report under subsection (1).’.

 


 

Review of pension credit entitlement

 

Mr Nigel Waterson

 

Andrew Selous

 

Mr Mark Lancaster

 

Withdrawn  NC2

 

To move the following Clause:—

 

‘(1)    

The Secretary of State may from time to time, and shall when required by

 

subsection (2), lay before each House of Parliament a report by the Government

 

Actuary or the Deputy Government Actuary on—

 

(a)    

current rates and coverage of pension credit entitlement;

 

(b)    

likely future rates of pension credit entitlement; and

 

(c)    

such other matters as he considers to be relevant as affecting the present

 

and future take-up of and eligibility for pension credit.

 

(2)    

The Secretary of State shall lay such reports—

 

(a)    

five years after the coming into force of Part I of this Act, and


 
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