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Lord Lucas moved Amendment No. 85:

Page 19, line 45, leave out (" 3") and insert ("(Prohibition orders)").

The noble Lord said: My Lords, I spoke to this amendment when I moved Amendment No. 3. I beg to move.

On Question, amendment agreed to.

Clause 34 [Provision of documents for members]:

The Earl of Buckinghamshire moved Amendment No. 86:

Page 20, line 16, at end insert:
("( ) if the scheme is subject to the minimum solvency requirement and the actuary has prepared a certificate under section 48 or 50, a statement by the actuary concerning such aspects of the certificate as may be prescribed and containing such other information as the actuary considers to be relevant and appropriate in the circumstances,").

The noble Earl said: My Lords, in moving this amendment, I shall speak also to Amendment No. 87 which stands in the name of the Minister. I believe that Amendment No. 87 may well meet the prime objective of Amendment No. 86. In those circumstances, I should prefer to hear what the Minister has to say about Amendment No. 87. I beg to move.

Lord Mackay of Ardbrecknish: My Lords, it may be for the convenience of the House if I intervene at this point to explain the intention behind the government amendment. If other noble Lords wish to intervene afterwards, I shall try to answer any questions raised.

I am grateful to my noble friend for his brief introduction. I agree with him that trustees should obtain comprehensive information from the scheme actuary concerning the financial position of the scheme. It is also important that members have access to information about the funding position, especially in relation to the minimum solvency requirement.

Powers are already contained in Clause 49(5) to prescribe what information and statements should be produced about the scheme's ability to meet the minimum solvency requirement. I agree that this is not wide enough and propose in my alternative amendment a wider power. This effectively preserves the existing powers in the Pension Schemes Act.

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Subject to the amendment which I propose, the powers in this clause enable the introduction of comprehensive requirements along the lines that I have mentioned. I am glad to have my noble friend's support in relation to this amendment which largely achieves what his amendment seeks to secure. I congratulate my noble friend on raising the matter for which, on second thoughts, we clearly saw the argument. I am sure that my noble friend will withdraw his amendment and will allow my amendment to proceed.

The Earl of Buckinghamshire: My Lords, I thank my noble friend for his kind words. Having listened to what he said, I am very pleased to allow his amendment to proceed. On that basis, I beg leave to withdraw my amendment.

Amendment, by leave, withdrawn.

Lord Mackay of Ardbrecknish moved Amendment No. 87:

Page 20, line 17, leave out from beginning to ("a") in line 18.

On Question, amendment agreed to.

[Amendment No. 88 not moved.]

Baroness Dean of Thornton-le-Fylde moved Amendment No. 89:

Before Clause 35, insert the following new clause:

Training for trustees

(".—(1) Every person appointed as a trustee shall undertake a short course of training approved by the Authority (unless he has already undergone such a course or holds a relevant professional qualification).
(2) The appointment as trustee of any person who fails to undertake such an approved course within six months of his appointment shall lapse and may not be renewed without the approval of the Authority.").

The noble Baroness said: My Lords, when I was discussing this Bill—and indeed the whole area of trustees—with colleagues of mine, one of them said to me that it beggared belief that someone having the responsibilities conferred by this Bill, who will be managing trust funds for beneficiaries which equate, as has been said earlier this evening, with something like one third of the value of all the shares on the London Stock Exchange, cannot be compelled to have some kind of training. It is really quite incredible if one considers the matter in depth. Indeed, I tried to think of any job that does not have some kind of training. It was difficult. The position involves the management of large amounts of money and carries considerable responsibilities and penalties for the individual. Not to require compulsory training is quite amazing and needs rectifying.

Nevertheless, the world is full of courageous people and perhaps they would be courageous enough to take on board the responsibilities of being a trustee. That is what we all want to see. However, I looked again at the Bill. Under the penalties to which the individual trustee can be subjected—mere suspension, or removal from office—there are 12 offences, all of which can be imposed upon the individual trustee.

If we take the next ratchet up penalty, we see that the penalty of a fine could be imposed on individuals responsible for pension funds. That makes a total of 17

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offences. Fourteen of those offences with a penalty of a fine relate to individual trustees. If we take the ultimate sanction under the Bill—the criminal penalty—which attracts a fine or imprisonment, that amounts to five offences, three of which relate to trustees. In fairness and equity, how can we subject individuals to that kind of potential penalty and then tell them that they are not required to have some kind of compulsory training? How can they be guilty of a misdemeanour if they have had no training?

In Committee the Minister said that he felt that it was up to schemes to decide the training needs of their trustees. That is not the view of many; indeed, that is not the view of many people who have lobbied very hard on the matter, despite the fact that the Goode Committee stated that it would not put forward the requirement for compulsory training. We feel that it is right to seek training from a body outside the scheme administrators and consultants. They are far too inclined—and I have personal experience of this—to give their impression as professionals within the scheme on how things should be done and on the correct way that the scheme should operate. Let us bear in mind the fact that exposure to the individual perceptions of those professionals could result, if the legislation is breached, in suspension, removal, a fine or, at its worst, imprisonment.

There has to be some kind of quality control on courses. There are many quite reputable bodies which currently provide courses of three days or one week. They do not last long. Indeed, the TUC put about 1,000 trade union trustees through training courses, and I gather that the National Association of Pension Funds has a range of courses that cost between £100 and £900. They are not expensive in the way of things as regards pension schemes that are handling so much money. If you give people responsibilities, I believe that you must also give them rights. By imposing a compulsory requirement to train, we would in fact be giving individual trustees a right. I beg to move.

Baroness Seear: My Lords, I should like briefly to support the amendment. However, unlike the noble Baroness, Lady Dean, I can think of far too many jobs for which no training is required, starting with membership of both Houses of Parliament. But that is not an argument against having training; indeed, I should have thought it is very much an argument in favour of it. Given the risks that trustees are undertaking, it is only fair to them that they should have training, if only to expose to them the nature of the risks involved.

I can well envisage a number of well-meaning people who, for a variety of reasons, might agree to be trustees while having very little idea about what it is that they are required to do or what the penalties may be if they slip up. I hope very much that the Government will not resist this sensible requirement. It would be very much better if it applied in a great many other areas too.

Lord Mackay of Ardbrecknish: My Lords, as the noble Baroness, Lady Dean, explained, this amendment would require a trustee to undertake a short course of approved training within six months of his appointment.

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In effect, the amendment requires compulsory training for all trustees. The Government do not dispute for a moment that trustees should be properly trained but we believe there are very sound reasons why such training should not be made compulsory.

Compulsory training does not by its very nature take account of the different training needs of individual trustees. It is not simply a matter of exempting those who have undertaken such a course or who hold relevant professional qualifications, as described in the amendment. Some trustees would have been doing the job for years and have a wide background in pension matters. Others would be new to the job. Yet others would fall somewhere in between. Compulsory training would not, and could not, take account of their different needs, learning abilities, personal preferences or even their domestic arrangements. For example, a training course away from the workplace—

Baroness Seear: My Lords, does not the Minister agree that some of the people who have been doing jobs for years are very much the ones who most obviously need training?

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