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Viscount Ullswater: My Lords, I thank my noble friend. From the breadth of his experience, he has put his finger very much on the point with which we have tried to deal in the amendment. I commend the amendment to the House.

Lord Bridges: My Lords, before the Minister moves the amendment, will he please clarify that the amendment as drafted is correct? Should it not be—

Noble Lords: Order!

The Earl of Lindsay: My Lords, I believe that on Report the procedure is that once the Minister has spoken, only the noble Lord moving the amendment can speak thereafter.

On Question, amendment agreed to.

4.45 p.m.

Baroness Hilton of Eggardon moved Amendment No. 6:

Page 115, line 7, leave out ("may") and insert ("shall").

The noble Baroness said: My Lords, in moving Amendment No. 6, I should like to speak initially also to Amendments Nos. 7, 8 and 9. They seek to transfer the pension rights of those members of the NRA and other organisations which will become part of the new environment agency. The amendments seek to place a statutory duty on the agency to adopt the local government superannuation schemes for both the existing employees of the NRA and other future employees of the agency. They also seek to make arrangements for the separation of the funds of the National Rivers Authority staff and the remnant water authorities' superannuation fund so that the Secretary of State has power to place the administration of the remnant water authorities' superannuation fund with an appropriate body. That will prevent the raiding of one pension fund by another and will ensure the continuance of pensions paid to pensioners and their widows under the water authorities' superannuation fund.

The amendments also place an obligation on the agency to establish a joint pensions advisory committee by agreement with the recognised trade unions. There are analogies with other existing transfers of pensions—for example, the existing London Pensions Fund Authority which looks after former GLC employees. In relation to the advisory committee, I understand that the National Rivers Authority currently has such an advisory committee. The amendments will therefore place the new staff of the agency on all fours with staff of other such agencies in the past.

Amendment No. 10 is rather different although it is grouped with Amendment No. 6. It seeks to ensure that health and safety provisions are promoted within the

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agency. Despite repeated requests from the recognised trade unions and the intervention of the Health and Safety Commission, the National Rivers Authority has refused to establish a national joint health and safety committee. It is hoped that the new environment agency will set up such a national committee to ensure that the same standards are applied in its workplaces throughout the country. The present situation with the NRA has brought to light weaknesses in the current health and safety legislation which, although it makes provision for committees to be established at individual workplaces, does not make a similar provision at a national or corporate level. Therefore, it is intended under Amendment No. 10 that there should be a possibility of setting up such a national umbrella committee to ensure similar standards throughout the country. I beg to move.

Lord Crickhowell: My Lords, I suppose that I should declare an interest in that I am currently the chairman of the NRA's pensions committee and therefore have responsibility for the management of some of the funds referred to in the amendment. I could not support the amendment as it stands because I do not agree with certain aspects of it. However, it raises some important points which I do support.

In my view, it is right in principle that all the employees of the agency should be members of one scheme. It is correct to say that at the moment the NRA's scheme comes under the local government superannuation arrangements. I think that it would be a mistake to commit the Government for ever to including the agencies' pensions under the local government superannuation scheme. I believe that that is appropriate at present, but I do not see why it should necessarily apply for all time.

However, I do not know the Government's view about HMIP employees who are in a different pension scheme. I do not know what the Government intend to do about those employees when they join the new agency. I can well understand that those employees might wish to hang on to their existing pension arrangements. On the other hand, from the point of view of managing an agency, it would be unsatisfactory to have two totally separate sets of pension arrangements. It would be useful to have the Government's intentions on that matter set out—if not today, then before the Bill leaves Parliament.

If other employees are to join the existing scheme, it is important to ensure that adequate provision is made for transfers into the fund—in other words, that the surplus on the NRA's active fund does not end up subsidising transferees into that fund.

The issue identified in Amendment No. 9 relating to the maintenance of separate funds is extremely important. Suggestions have been made that they may be merged. In my view, that would be a wholly unsatisfactory situation. The closed fund has placed on the NRA the responsibility in very difficult circumstances of looking after the pensions of people who have never been its employees. They have been employees of the water industry prior to the setting up of the agency. It is most unfortunate that the time and resources of the NRA and potentially in the future of

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the new agency should be diverted to looking after those for whom it should have no responsibility. It would be much better if those responsibilities were transferred to some other appropriate administering authority. I suspect that the situation arises elsewhere as a result of privatisation. There is much to be said for bringing together remnant funds under a single management where specialists can look after them.

The closed fund was transferred at a particularly awkward moment and in particularly awkward circumstances. It was transferred just before the market reached an all-time high. As a consequence of what happened then, it has a deficit. There are problems in running a closed fund. As one reaches expiry one has to continue to fund pensions with no income coming in. The investments have to be sold in more and more difficult circumstances. A moment will come when the Government and the Treasury have to decide what to do about picking up this responsibility. It would be intolerable—here I warmly support the amendment—if an attempt were made to solve the problem by merging the funds so that any surplus properly created on the active fund was used to subsidise, or part-subsidise, the deficit on the closed fund.

I cannot pretend that I am happy about the need to establish what is called a joint advisory committee. It seems to me to be an attempt to impose an unnecessary strict set of rules. There is a pensions committee in the NRA which includes employee representatives. It has worked well and enjoys the support of the trade unions. I would have thought that something similar would be wholly appropriate for the new agency.

The move to a national committee to deal with health, safety and welfare is, I believe, an unnecessary imposition of rules and bureaucracy. There is much to be said for pushing such responsibilities down to regional and local committees which can deal with the situation on the ground. That is not to say that the agency itself will not have a responsibility to maintain the highest standards of health and safety. In that respect I believe that the NRA's record has been rather good. It is a proper management responsibility. Probably the best place to negotiate these matters in a way that deals with the problems is at local level rather than by imposing by statute the requirement for a second tier on top.

Some important points are raised by the amendments. This is a good opportunity for the Government to clarify their intentions. I hope, however, that the noble Baroness will not press the amendment; I believe it to be seriously flawed in some of its details.

Viscount Ullswater: My Lords, I well understand concerns about pensions. The noble Baroness, Lady Hilton, tabled very similar amendments in Committee. I wish to confirm the points I made at that time. First, I confirm that the agency will, through secondary legislation, be designated as an administering authority for the local government superannuation scheme. We do not need primary legislation for that purpose. Moreover, Amendment No. 8 appears to require the agency to offer pensions only under the LGSS. That would be an unnecessary restriction on the agency's ability to develop appropriate alternative arrangements

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for its staff. Nor can I accept the provisions of Amendments Nos. 6 and 7 which would require the agency to offer all staff the right to a pension under the LGSS. The agency must have freedom in appropriate cases to offer non-pensionable jobs. I reiterate, however, that existing staff who transfer to the agency and whose employment is pensionable must be offered comparable pensions. Staff who are members of LGSS will be offered continued membership of that scheme.

My noble friend Lord Crickhowell asked about those from HMIP and their schemes. We are still considering the future pension arrangements for HMIP staff who will transfer and who are presently on the principal Civil Service pension scheme. Those are ongoing considerations.

As I explained in Committee, there is no need for the Bill to provide for the pension funds of the NRA to vest in the agency as they will automatically transfer. Nor do we think it appropriate to require the agency to establish a joint advisory committee to oversee the management of the scheme. I am supported in that view by my noble friend Lord Crickhowell. LGSS regulations already require administering authorities to act prudently in the management of their funds, and the statutory limits which apply to LGSS administering authorities ensure this requirement.

Amendment No. 9 refers to the closed fund for ex-water authority pensioners for which the NRA is currently responsible. In Committee I said that we were considering the future of that fund. I regret that so far I am unable to report an outcome to those deliberations. We intend to report before the Bill completes its passage through Parliament. For now, I can assure your Lordships that the pension entitlements under the LGSS, which staff in both the closed and active funds currently enjoy, will continue to be honoured. I believe that my noble friend has indicated some of the problems still to be resolved.

Amendment No. 10 deals with health and safety. The amendment is unnecessary. The Health and Safety at Work etc. Act 1974 and regulations made thereunder already provide for the appointment by recognised trade unions of safety representatives and for an employer to establish a safety committee if requested to do so by two or more safety representatives. With those words, I hope that the noble Baroness will withdraw the amendment.

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