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"( ) Nothing in regulations under this section may require the trustees or managers of a closed scheme to obtain an actuarial valuation of the scheme until—
(a) the period within which the issue of the determination notice, under section 144(6), in respect of the Board's determination to authorise the scheme to continue as a closed scheme, may be reviewed by virtue of Chapter 6 has expired, and
(b) if the issue of the notice is so reviewed—
(i) the review and any reconsideration,
(ii) any reference to the PPF Ombudsman in respect of the issue of the notice, and
(iii) any appeal against his determination or directions,
has been finally disposed of and the notice has not been revoked, varied or substituted."
Page 104, line 26, at end insert—
"prepared and signed by the actuary"
On Question, amendments agreed to.
Baroness Hollis of Heigham moved Amendment No. 213:
(i) a person with prescribed qualifications or experience, or
(ii) a person approved by the Secretary of State"
The noble Baroness said: I beg to move.
[Amendment No. 213ZA, as an amendment to Amendment No. 213, not moved.]
On Question, Amendment No. 213 agreed to.
Baroness Hollis of Heigham moved Amendments Nos. 213A to 213C:
On Question, amendments agreed to.
Clause 147, as amended, agreed to.
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Clause 148 [Applications and notifications where closed schemes have insufficient assets]:
[Amendment No. 214 not moved.]
Baroness Hollis of Heigham moved Amendments Nos. 214A to 214D:
"assets", in relation to a scheme, do not include assets representing the value of any rights in respect of money purchase benefits under the scheme rules;
"closed scheme""
On Question, amendments agreed to.
Clause 148, as amended, agreed to.
Clause 149 [Duty to assume responsibility for closed schemes]:
Baroness Hollis of Heigham moved Amendment No. 214E and Amendment No. 214F:
"( ) An application under subsection (1) of section 148, or notification under subsection (4) of that section, is to be disregarded for the purposes of subsection (1) if it is made or given during an assessment period (see sections 124 and 150) in relation to the scheme which began before the application was made or notification was given."
On Question, amendments agreed to.
Clause 149, as amended, agreed to.
Clause 150 [Closed schemes: further assessment periods]:
Baroness Hollis of Heigham moved Amendment No. 214G and Amendment No. 214H:
"( ) For the purposes of subsection (1) an application under subsection (1) of section 148, or notification under subsection (4) of that section, is to be disregarded if it is made or given during an assessment period (see section 124 and this section) in relation to the scheme which began before the application was made or notification was given."
On Question, amendments agreed to.
Clause 150, as amended, agreed to.
Baroness Hollis of Heigham moved Amendment No. 214J:
"( ) A transfer notice may not be given in relation to a scheme during any period when the issue of, or failure to issue, a withdrawal notice under or by virtue of section 138 or 139 (refusal to assume responsibility) is reviewable (see section 140(6)(b))."
On Question, amendment agreed to.
Lord Skelmersdale moved Amendment No. 215:
The noble Lord said: This amendment pre-empts what one might have discussed on Clause 163, because it is a forerunner of that clause. Having learned earlier this afternoon that the assessment period is likely to be
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a minimum of 12 months, one is bound to ask a different question from the one I originally intended when I tabled the amendment—without having the information so nobly imparted by the Minister. Is 12 months long enough in this case? I beg to move.
Baroness Hollis of Heigham: As a direct response to the noble Lord, we think that we have got it right based on the experience of the Pensions Compensation Board. The board has followed through three cases of fraud; two took eight months and the third took 11 months, so it seems to be about the right time. We do not want to artificially elongate the time if there is no fraud and thereby leave things in an insecure state. From our experience the time period seems appropriate.
I was expecting the noble Lord to argue the opposite and I was going to explain to him why six months would not be enough given the experience of the Pensions Compensation Board. The three cases that we have seem to fit this time scale, but who knows.
Lord Skelmersdale: There is a problem because the subsection talks not only about the fraud compensation application, but also about the assessment period. Are we again using "assessment period" in two entirely different senses? We have spent much time this afternoon talking about the length of assessment periods. In this case are we talking about the assessment period for fraud or the general assessment period that we have been discussing all afternoon?
Baroness Hollis of Heigham: It is just the same. Given what I have described, we expect the assessment period to last for a minimum of 12 months. One thing that we expect to be checked in that period is fraud. That is why I was going to argue that reducing the period to six months would be inappropriate. Obviously that forms part and parcel of the assessment period, along with looking at the manipulation of schemes, changing the scheme rules in the preceding three years, cleansing the data, and so on. Therefore, I do not think that there is any problem here.
Whether a more substantive issue arises—that is, that 12 months will not be long enough—then, as I said, all we can do is to work on the evidence thus far that such cases of fraud are fairly rare. Cases of serious fraud, in particular, end up in court procedures involving the recovery of assets and so on, and that may take it out of the PPF's realm altogether.
Lord Skelmersdale: I am afraid that I have been a little naughty because the advantage of having a hook on which to hang a question—a hook in terms of an amendment—is that the barb can go both ways. In this case, it has gone the least obvious way according to the words in the amendment.
That said, I think that I am pleased with the answer but I am still slightly confused about the reference to the assessment period as well as to the fraud compensation application pending. Clause 163 is entirely about fraud and therefore perhaps it would be
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sensible to use another word instead of "assessment period" if it is an assessment period covering a fraud rather than an assessment period by the board, which is very different.
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