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Lord Newby: My Lords, I congratulate the noble Baroness, Lady Noakes, on bringing forward the Bill today. Whether she is unusually prescient or whether she has precipitated the ombudsman to bring forward her report, I am not sure. The timing is absolutely perfect.

We, on these Benches, have supported the ombudsman route as the most likely way, post Penrose, of achieving progress on Equitable Life. Therefore, we are extremely pleased that the ombudsman has decided, in principle, that she would like to investigate Equitable. However, the question is whether the Government will allow her to do so by extending the scope of the Act that we are discussing tonight to bring the Government Actuary's Department within it. A failure by the Government to agree fairly rapidly to do that would suggest that they are obstructing a possible definitive ruling on at least one aspect of the Equitable Life debacle. Therefore, I hope very much that they accede to the ombudsman's request.

Given that we have a Bill before us which does that—here is one that the noble Baroness prepared earlier—it would seem that the sensible way forward from the Government's point of view is just to agree to it and be done with it, save the time and let the ombudsman get cracking. One of the main problems with this whole sorry story is the amount of time that has passed since the problems arose and even the possibility of any redress.
 
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So I hope that the Minister will be very forthcoming this evening. If not, I hope that the Government will come forward with a speedy response. It is a very simple request. The legislation required is short and sweet. There can be no "in principle" argument against introducing it. So I am afraid that it is over to you, Minister.

Lord Bassam of Brighton: My Lords, I congratulate the noble Baroness on her prescience in bringing this Bill before your Lordships' House and on pursuing this matter with her usual vigour.

As the noble Baroness said, the parliamentary ombudsman has this afternoon announced that she will conduct a further investigation into the prudential regulation of the Equitable Life Assurance Society—Equitable Life.

I know that the House is aware of the background. The ombudsman agreed to give further consideration to the position following the publication of the Penrose report and the Government's response to that report. In the special report laid before Parliament today, the ombudsman makes clear the reasons for her decision. Her decision was reached following an extensive consultation exercise. In her report, she states that she,

"received approximately 2,000 responses, including 211 from Members of Parliament, 1,603 from policyholders or former policyholders, three from policyholder action groups, and responses from Equitable Life, the Treasury, the Financial Services Authority, the Government Actuary's Department and the Department of Trade and Industry".

So I think we need be under no illusion that there is considerable concern about the whole issue—a very sorry saga, as the noble Baroness described it.

As part of the consultation exercise, the ombudsman also invited a number of interested parties to meet her, and the details are set out in the report.

The ombudsman states in her report that the new investigation will focus on the actions of the government departments responsible under the relevant legislation for the prudential regulation of Equitable Life. She makes clear that her investigation will, subject to the approval of a request she has made of the Government, also include the actions of the Government Actuary's Department.

This afternoon the Government received a formal request from the ombudsman to make the necessary arrangements to include the Government Actuary's Department within her jurisdiction. We have only just received this request and we will give it urgent consideration, not least because of the time that has elapsed since the onset of problems with this particular issue relating to Equitable Life. We will reply to the ombudsman as soon as we possibly can.

I have been invited to make some observations on the noble Baroness's Bill. I shall keep these brief. First, if the Government agree to the request to include the Government Actuary's Department within the ombudsman's jurisdiction, Section 4(3) of the
 
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Parliamentary Commissioner Act 1967 provides that public bodies which meet certain criteria can be added to her jurisdiction by Order in Council. Bodies not meeting those criteria could only be added by primary legislation.

Therefore, if the Government agree to the ombudsman's request to include the Government Actuary's Department within her jurisdiction, they could be expected to do this by Order in Council rather than primary legislation. The Government are therefore not convinced of the need for this part of the Bill.

Secondly, in addition to including the Government Actuary's Department within the ombudsman's jurisdiction, the noble Baroness's Bill also proposes amending Section 6(3) of the 1967 Act. That section of the Act provides that, where there are special circumstances which make it proper to do so, the ombudsman may consider complaints more than 12 months old.

The amendment proposed by the noble Baroness would add a new paragraph, which would provide that the commissioner,

"(b) shall conduct an investigation pursuant to a complaint not made within that period if the House of Commons so resolves".

At present, the ombudsman decides what cases to investigate. To give the other place the power to tell the ombudsman that she must investigate would, I believe, have implications for the operation of the office of ombudsman. I also think it unlikely that the ombudsman herself would support a Bill that sought to fetter her decision-making powers.

I make these observations on the noble Baroness's Bill, not in the spirit of great hostility because I recognise the spirit in which the Bill has been constructed. I am prepared to give an undertaking, which is a quite easy one to give, that we will reply to the ombudsman on the issue of including the Government Actuary's Department within her jurisdiction as soon as possible because we recognise the urgency of the issue.

The ombudsman's report is most helpful. We will make a rapid response. While we are not hostile to the Bill, it is deficient in the ways we have described. So, it is not for us obviously to deal with that matter today. Much as we welcome the opportunity to make our views known with regard to the usefulness of the ombudsman's report, it is probably best if we leave it there.

Baroness Noakes: My Lords, I thank the noble Lord, Lord Newby, for his support for the Bill and I thank the Minister for his response. Perhaps I may say to both noble Lords that I do not feel that I had prescience in the matter; I think I was lucky with my timing.

The Minister used the sorts of formulations that we often hear from the Government Front Bench—that the matter will be given urgent consideration and that a reply will be made as soon as possible. We know that that can mean many things to many Ministers. I hope that the Minister will send a message back to
 
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colleagues in the Treasury that this really is an important matter which needs to be dealt with earlier.

If the Government do agree, I accept that the simplest procedure would be to add the Government Actuary's Department by Order in Council. But until we see the Government's response we must wait and see.

I hear the Minister's comment that the additional power to the other place may well be deemed to be excessive, but I would say to the Minister that the purpose of the existence of the parliamentary ombudsman is as a check on the executive, not as a
 
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check on the other place. If we can improve ways in which the executive can be held to account, then I cannot see that anybody really can object to that.

Inevitably, today's report of the parliamentary commissioner has changed the scenario. Over the summer obviously I shall be considering what to do with my Bill alongside consideration of any government response.

On Question, Bill read a second time, and committed to a Committee of the Whole House.

House adjourned at eleven minutes before eight o'clock.

 
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Official Report of the Grand Committee on the

Pensions Bill

(Fifth Day)

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