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Lord Skelmersdale: My Lords, I echo the opening words of the noble Lord, Lord Oakeshott, and say that we few pensions addicts—not, I hope, interested persons, in the sense that the Minister used—are grateful to the Minister for explaining the regulations so clearly. I have no points of detail to raise, other than to echo the words of the noble Lord, Lord Oakeshott, not least in his remarks relating to the report of the Merits of Statutory Instruments Committee, of which the Minister is an aficionado, having been its first chairman.

However, that brings me to statutory instruments generally, and the second one that we are debating in particular. I accept that the Minister has come clean, not only today but in his helpful letter to the noble Lord, Lord Oakeshott, and myself, on the drafting mistake in the modifications regulations. This drafting mistake raises two issues. The Minister's officials will no doubt know that I got quite incensed at what I regularly described in the Joint Committee on Statutory Instruments as "sloppy drafting". Regulation 5(7) of the order to which I am referring is a current example. How on earth can officials extend the existing timescale in which the scheme manager can request a review of member-related decisions when there is no timescale? What has happened to the checking which used to take place in the Minister's department when I was there?

Paragraph 7(c) of the regulations refers in error to a previous regulation which we are not amending and in which, as I said, the time for appeal is open-ended, so
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there is no point in amending it here. The original paragraph 3 of the Financial Assistance Scheme (Internal Review) Regulations needs a redraft, which we are promised.

That brings me to my second point. If these regulations were negative, not only would we not be debating them but they would already be law, and so an amending order would be necessary, forthcoming and, again, not debated. These regulations—indeed, all regulations—concerning the Financial Assistance Scheme are made under the affirmative resolution. I was brought up, parliamentarily speaking, to believe that parliamentary time is a valuable commodity. The proper course for the Government would be to withdraw these regulations and relay them properly drafted. They should have done so last week. Had they not already been passed by another place, I would have asked the Minister to do just that—withdraw them—and, if he refused, I would have sought the opinion of the House. However, they have now slipped through another place and so that is not the position that we are in today. Therefore, the Minister will be relieved to know that, on this occasion, I will not do what I have just threatened. Nevertheless, I put him on notice for the future.

As I said, as far as these orders go, I have no questions but, like the noble Lord, Lord Oakeshott, I want to make some general points. Does the Minister yet know how many people will be given financial assistance under the scheme? This subject has arisen each time we have debated the Financial Assistance Scheme and the various adjuncts to it made through orders. At the time of the Bill, the figure was 60,000; a couple of orders ago, the figure was 70,000; now, it is suggested that 85,000 people have a realistic claim under the scheme.

Like the noble Lord, Lord Oakeshott, I am on record as saying that £20 million over 20 years—in other words, £400 million over the life of the scheme—is mean, and I believe that it was the smallest amount that the Government thought they could get away with. But let us for a moment give the Government the benefit of the doubt and say that it was sufficient for 60,000 people. How can it still be said to be enough now that there are so many more impoverished pensioners within the scheme; or is the Minister going to tell us that it does not really matter as some of them will be eligible for pension credit and all will be well in the end? I hope not—that would really annoy my noble friends, especially as some of the recipients will either be expected to have, or will be trying to get, further employment and thus will not be eligible.

Lastly, no assistance has yet been paid out. The Government speak of payments starting "at the end of the year". Does that mean before or after Christmas, and does the Minister mean that this timetable is still viable?

Lord Hunt of Kings Heath: My Lords, I am grateful to both the noble Lords, Lord Skelmersdale and Lord Oakeshott, for their comments. Although they made
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some criticisms of the Government's handling of this measure, I am grateful for their general support for the regulations.

I start by dealing with the issue of errors and, again, I apologise to the House. It is most unfortunate. Noble Lords will know that, when I was chair of the Merits of Statutory Instruments Committee, I took a particular interest in the proper production of statutory instruments and the ability of this House properly to scrutinise them. I do not depart from that, and it is a matter of great disappointment to me that I have to come before your Lordships' House to apologise for an error that has occurred. I can assure noble Lords that I will do everything in my power to ensure that this does not happen again and we will try to put it right as soon as possible.

I turn to the specific comment of the noble Lord, Lord Oakeshott, and the Merits of Statutory Instruments Committee about the pace and timing of the various statutory instruments that have to be brought forward. Much of that reflects the need to get this new FAS system up and running as quickly as possible. Inevitably some problems have arisen in the timing of the regulations and some of the changes that have had to be made because of the need for speed. In answer to the noble Lord, Lord Skelmersdale, I am advised that the FAS unit intends to make payments by the end of the year. I take that to be the calendar year and will stand by that. If I can give the noble Lord any more details, I will write to him, but clearly it is very important to get payments out as soon as possible.

7.45 pm

We debated the issue of running costs in July. The figure is the same as I gave then—that is, £16 million—and at present there is no change to that estimate. Obviously, in the light of experience, we will have to look at the matter again but that is the figure that I have. We shall be employing about 60 people in the York office of the FAS. It has had to be produced and I want the administration of the scheme to be as efficient as possible. I am sure that we are working towards that. None the less, the scheme will cost money and we must accept that.

I do not know whether I should respond to the general points raised by the noble Lords, Lord Oakeshott and Lord Skelmersdale. I think that the matter has been debated and, in the end, Parliament has reached the decision that this is the route down which we should go. Inevitably, hard decisions have had to be made in setting up the assistance scheme—I do not think that anyone would disagree with that. Any government in our position would have to make similar decisions, although there may be disagreement about the approach taken. No one can be in any doubt whatever about the personal consequences for individual pension scheme members when their pension schemes go down. We discussed that in a debate last week and one can only have extraordinary sympathy for anyone affected in that way.
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The £400 million is the amount of money that we have set aside. I believe I said in July that that will be reviewed in the next spending round cycle, and we will then know more about the number of schemes that the FAS has accepted and the number of scheme members involved. At the moment, we envisage that up to 15,000 members who are within three years of the scheme's normal retirement age will benefit from the FAS topping up their pensions. I say to the noble Lord that it is early days. The period during which applications have to be made ends on 20 February and we will know much more after that date. When that date is reached and we have more up-to-date estimates, I shall of course be very happy to write to both noble Lords.

Lord Skelmersdale: My Lords, I am grateful to the Minister for giving way. In view of the figures that were bandied about when we discussed the Bill and on subsequent occasions, 15,000 seems to me to be a very small figure. Is that because so far applications have not been made or is there another reason? Is the department advertising the existence of the scheme?

Lord Hunt of Kings Heath: My Lords, these are the latest estimates that I have been given. However, they come with the caveat that at the moment it is very difficult to estimate the number of pensioners, and I think that we will have to wait until the end of February to have a clearer idea. It is important to consider the number who will benefit from the scheme in relation to the number of pensioners who may be affected by insolvent schemes but will not be eligible to receive payments from the FAS scheme. The figure of 85,000 that he has quoted may reflect estimates of the number of those people rather than of those who are eligible. As I say, it is early days. I cannot say much more at this stage, but I will come back to the noble Lord when I have further information.

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