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Baroness Hollis of Heigham: My Lords, perhaps the noble Earl, Lord Ferrers, may forgive me, but I cannot resist this: I just wonder whether the noble Earl has voted previously. If so, he has voted on amendments that refer to FAS. I am sure that he would not have voted for something that he does not understand. FAS stands for the financial assistance scheme, which we have been discussing for the past two or three hours in respect of the various amendments associated with it on which Members of your Lordships' House have expressed a view.
Earl Ferrers: My Lords, I am deeply grateful to the noble Baroness. She need not worry too much because I did not vote on that. But I am grateful to her for at least explaining what she was talking about for those of us who did not understand.
Baroness Turner of Camden: My Lords, I thank my noble friend for that detailed explanation, which I shall study with some interest in Hansard. The noble Lord, Lord Skelmersdale, raised the matter of the inclusion of the word "otherwise". This is a case where I can blame the lawyers. A draft was proposed to me by the union's lawyers who worked with the union on wording. Since I assumed that they would know more about the matter than me, I repeated their wording. But I should have looked at it more carefully, as the noble Lord, Lord Skelmersdale, clearly did.
We were talking about a number of employers participating in a scheme, part of which may be sectionalised. I accept that that can be a very complicated matter. But I fear that there may be quite a number of such schemes around currently where employers have merged and bring their own schemes into an overall scheme, and so on. That could provide some problems for the future. My noble friend the Minister has acknowledged that and has said that it is receiving consideration. On that basis, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 271 to 273 not moved.]
Lord Skelmersdale moved Amendment No. 274:
The noble Lord said: My Lords, I shall ask a question to which I suspect the answer will be, "I have not the slightest idea": I am quoting what I think that the Minister is about to say. Quite simply, which schemes will not qualify? Under Clause 284(2), a
In other words, what will not qualify?
I was more than a little surprised—in fact, I was horrified—to hear the noble Baroness say that there might be a case for having a solvent employer with an
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underfunded scheme eligible for the FAS. That is what I understood her to say in part of her response to the noble Baroness, Lady Turner.
However, I suspect that I will not get a reasonable answer, but I shall still move the amendment. I beg to move.
Baroness Hollis of Heigham: My Lords, I hope that I will be able to help the noble Lord. The amendment would extend the potential range of schemes that could qualify for inclusion in the FAS to any occupational pension scheme that is not a money purchase scheme. The purpose of the clause is to ensure that schemes that qualify for the FAS would have similar characteristics to those that will be eligible for the PPF. That is still our intention.
Although the PPF has not yet set out precisely which schemes or descriptions of schemes will not be eligible, it can be expected that this will include those types of scheme that will be excluded from the new scheme specific funding regime, which was formerly the MFR (minimum funding requirement). On the assumption of a read across—therefore, who would be excluded—that is because those schemes already have an existing framework that provides a high level of security. One example of that is schemes where there are fewer than two members, where the sole member might be expected to monitor the funding level of their scheme.
In my second example, the FAS would also, by this amendment, be forced to help schemes that have not been tax approved. Those are generally established for highly paid employees, such as senior executives, and supplement the benefits that they will receive from approved schemes. The noble Lord asked who would be excluded. I have given two examples, which I hope he will think is enough.
Lord Skelmersdale: My Lords, things are improving just marginally. However, in answer to two successive amendments, I suggest that the noble Baroness has said rather different things. Just now, she said to the noble Baroness, Lady Turner, that the Government were considering whether solvent employers with underfunded schemes would be covered by the FAS. She is now saying that the PPF rules will almost invariably apply. The point about the PPF is that we are talking about employers who have gone broke with underfunded schemes.
The noble Baroness cannot have it both ways. Clearly, I shall have to read today's debate in Hansard even more carefully than usual and decide whether to sort this problem out at Third Reading. In the mean time, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Baroness Hollis of Heigham moved Amendment No. 275:
The noble Baroness said: My Lords, in speaking to Amendment No. 275, I shall speak also to Amendments Nos. 277 and 281, which apply to
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Clause 284. Amendments Nos. 275 and 277 would allow regulations to set a time limit within which schemes and members of fully wound-up schemes are required to notify FAS of their existence in order to be assessed to see if assistance may be provided in respect of those schemes.
It is important that the FAS is aware of all schemes in respect of which assistance may be provided within a reasonable time period. Otherwise, it would have to make contingency arrangements to meet an unknown number of possible future claims. That could have an adverse effect on budgeting arrangements and administrative costs.
It is quite common for such time limits to be set when claims are made for compensation or assistance that is not of an ongoing basis. We did that in the review of pensions mis-selling and the miners' compensation scheme, which were administered by the DTI. Unlike those two examples, the FAS will provide assistance rather than compensation. Therefore, it has greater justification for managing a limited budget through imposing a scheme notification period.
The details that would need to be provided as a result of the amendment would be minimal and merely relate to the scheme's existence. As part of the current data collection exercise, many schemes have already provided those details to the DWP. It is not our intention to require schemes to do them twice over, but we need to do it in that way.
Amendment No. 281 would allow, if required, regulations to set up procedures in connection with reviews and appeals against determinations made in relation to the FAS, and in connection with the investigation of complaints of maladministration against the scheme. It would also allow a body to be established, or for a person to be appointed, specifically for this purpose.
Noble Lords will be aware that we are still developing the details of the financial assistance scheme. This amendment would enable us to determine and put in place review and appeal arrangements which are congruent with Article 6 of the European Convention on Human Rights.
I hope that I have described in sufficient detail what these amendments seek to do and I ask noble Lords to support them. They are of course benign. I beg to move.
Lord Higgins: My Lords, I am most grateful to the noble Baroness for that explanation. I understand that one of the amendments is concerned with appeals and so forth, and one with the collection of data. Is it not rather strange that these amendments are being introduced at this stage in the proceedings? There were opportunities earlier in Grand Committee to bring forward this kind of amendment. I am not sure why they have turned up at such a late stage. Perhaps the noble Baroness could let us know the reason.
Baroness Hollis of Heigham: My Lords, I do not have an easy answer. In terms of the appeals procedures, I suspect that that may have been due to
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an oversight. On the collection of data, I think that we realised after further scrutiny that we had not provided for a time limit in a way that does not apply to the PPF. This is one issue where we will not have an exact parallel and therefore we needed to take specific powers.
On Question, amendment agreed to.
Lord Skelmersdale: My Lords, before we move on, given that we are so close to the witching hour of a quarter to seven when we are supposed to take the next Statement, would it not be sensible for us to break now?
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