House of Lords Amendments

House of Lords

Session 2006 - 07
Internet Publications
Other Bills before Parliament

Pensions Bill

Pensions Bill
commons REASONS FOR DISAGREEMENT
[The page and line references are to HL Bill 61, the bill as first printed for the Lords.]
Clause 1
LORDS AMENDMENT NO. 1
Page 2, line 32, at end insert—

“(3A)
With effect from the commencement of this section or 1st November 2007,

whichever shall be earlier, the contributor may at any time up to state

pension age, make voluntary (Class 3) contributions for any period of his

or her working life, in respect of up to 9 years, whether consecutive or not,

which for any reason shall not have satisfied the conditions for a Qualifying

Year or Years, so that such year or years shall then be deemed to be a

Qualifying Year or Years.”

COMMONS DISAGREEMENT AND REASON

The Commons disagree to Lords Amendments Nos. 1, 16, 17, 18, 23 and 24 for the

following Reason—
1A
Because they would involve charges on public funds, and the Commons do not offer any

further Reason, trusting that this reason may be deemed sufficient.
After Clause 18
LORDS AMENDMENT NO. 12
12
Insert the following new Clause—

“Minimum retirement income

(1)
The amount of the minimum retirement income in respect of each tax year

shall be set by the Chancellor of the Exchequer by order at the level of the

standard minimum guarantee prescribed under section 2 of the State

Pension Credit Act 2002 (c. 16).

HL Bill 96 54/2

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(2)
Before making an order under subsection (1), the Chancellor of the

Exchequer shall consult such persons as he considers appropriate.

(3)
An order under this section (other than the order that applies to the first tax

year during which this section is in force) must be made on or before 31st

January of the tax year before the tax year to which the order applies.”

COMMONS DISAGREEMENT AND REASON

The Commons disagree to Lords Amendments Nos. 12, 13, 14 and 73 for the following

Reason—
12A
Because they would alter provisions relating to taxation, and the Commons do not offer any

further Reason, trusting that this reason may be deemed sufficient.

LORDS AMENDMENT NO. 13
13
Insert the following new Clause—

“Retirement income fund

(1)
The Finance Act 2004 (c. 12) is amended as follows.

(2)
After section 152 (meaning of “arrangement”), insert—

“152A
Meaning of “retirement income fund”

(1)
In this Part a retirement income fund means a scheme for the

reinvestment of savings in retirement which—

(a)
is operated by or on behalf of a person authorised to operate

a registered pension scheme,

(b)
is a scheme in which investments are approved by the

Inland Revenue, and

(c)
meets the conditions set out in subsections (2) to (9).

(2)
The first condition is that, subject to the other conditions in this

section, funds held in the retirement income fund may be invested

and withdrawn by the member as and when he elects.

(3)
The second condition is that an authorised retirement income fund

provider must set an annual maximum withdrawal allowance for

each member, based on an assessment of each member’s life

expectancy, and a member’s withdrawals from the fund in any one

year must not exceed that allowance.

(4)
The third condition is that, in setting annual maximum withdrawal

allowances, an authorised provider must ensure that no member’s

total future income falls below the minimum retirement income

level, as set out under section (Minimum retirement income) of the

Pensions Act 2007, except in the circumstances provided for in the

sixth condition.

(5)
The fourth condition is that an authorised provider must set an

annual minimum withdrawal allowance so that each member’s

total income is at least equivalent to the minimum retirement

income level, except in the circumstances provided for in the sixth

condition.

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(6)
The fifth condition is that where a member chooses not to declare

his total annual income to the authorised provider, he must

withdraw funds equivalent to the level of the minimum retirement

income level or his annual maximum withdrawal allowance,

whichever is the lower.

(7)
The sixth condition is that, where there are insufficient funds to

enable the annual minimum withdrawal allowance to be set so that

a member’s total income is at least equivalent to the minimum

retirement income level, the allowance should be set at the highest

level consistent with the assessment of the member’s life

expectancy.

(8)
The seventh condition is that the maximum and minimum

withdrawal allowances must be set at the same level where a

member’s total annual income, including his maximum

withdrawal allowance, is lower than the minimum retirement

income level.

(9)
The eighth condition is that a retirement income fund, and any

income derived from it, must not be capable of assignment or

surrender by the member.””

COMMONS DISAGREEMENT AND REASON

The Commons disagree to Lords Amendments Nos. 12, 13, 14 and 73 for the following

Reason—
13A
Because they would alter provisions relating to taxation, and the Commons do not offer any

further Reason, trusting that this reason may be deemed sufficient.

LORDS AMENDMENT NO. 14
14
Insert the following new Clause—

“Withdrawal from a retirement income fund

(1)
Section 165 of the Finance Act 2004 (c. 12) (pension rules) is amended as

follows.

(2)
In subsection (1) (which sets out the pension rules)—

(a)
in Pension rule 4, after paragraph (a), insert—

“(aa)
a withdrawal from a retirement income fund,”;

(b)
in Pension rule 4, after the second appearance of the words “scheme

pension”, insert the words “a withdrawal from a retirement income

fund”;

(c)
in Pension rule 6, after paragraph (a), insert—

“(aa)
a withdrawal from a retirement income fund,”;

(d)
in Pension rule 6, after the second appearance of the words “scheme

pension”, insert the words “a withdrawal from a retirement income

fund”.”

COMMONS DISAGREEMENT AND REASON

The Commons disagree to Lords Amendments Nos. 12, 13, 14 and 73 for the following

Reason—

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14A
Because they would alter provisions relating to taxation, and the Commons do not offer any

further Reason, trusting that this reason may be deemed sufficient.

LORDS AMENDMENT NO. 15
15
Insert the following new Clause—

“Financial assistance scheme: scheme manager

(1)
The Financial Assistance Scheme Regulations 2005 (S.I. 2005/1986) are

amended as follows.

(2)
In regulation 5(1) for “Secretary of State” substitute “Board of the Pension

Protection Fund (“the Board”)”.

(3)
In regulation 5(2)(a) omit the words from “Secretary of State” to the end of

that paragraph and insert “the Board”.

(4)
In regulation 5, sub-paragraph (2)(b) is omitted.”

COMMONS DISAGREEMENT AND REASON

The Commons disagree to Lords Amendment No. 15 for the following Reason—
15A
Because it is inappropriate to replace the Secretary of State as the manager of the Financial

Assistance Scheme with the Board of the Pension Protection Fund.

LORDS AMENDMENT NO. 16
16
Insert the following new Clause—

“Financial assistance scheme: qualifying pension schemes

(1)
The Financial Assistance Scheme Regulations 2005 (S.I. 2005/1986) are

amended as follows.

(2)
In regulation 9, sub-paragraph (1)(c) is omitted.

(3)
Regulations 11 to 13 are omitted.”

COMMONS DISAGREEMENT AND REASON

The Commons disagree to Lords Amendments Nos. 1, 16, 17, 18, 23 and 24 for the

following Reason—
16A
Because they would involve charges on public funds, and the Commons do not offer any

further Reason, trusting that this reason may be deemed sufficient.

LORDS AMENDMENT NO. 17
17
Insert the following new Clause—

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“Pension Protection Lifeboat Fund

(1)
There shall be established as soon as reasonably practicable a Pension

Protection Lifeboat Fund (“the Lifeboat Fund”) which shall be

administered by the Board of the Pension Protection Fund (“the Board”).

(2)
The purpose of the Lifeboat Fund shall be to make supplementary

payments to persons who are qualifying members of qualifying schemes as

defined by the Financial Assistance Scheme Regulations 2005 (S.I. 2005/

1986) (or who would be qualifying members if the qualifying age for the

Financial Assistance Scheme were set at the level of the qualifying scheme

retirement age), in addition to the sums payable in any event under those

regulations.

(3)
The supplementary payments made to any person in accordance with

subsection (2) shall equal the amount that, taken together with any

amounts payable to that person under the Financial Assistance Scheme and

amounts payable to that person as scheme benefits under the qualifying

pension scheme in respect of which he is a qualifying member of the

Financial Assistance Scheme (or would be a qualifying member if the

qualifying age for the Financial Assistance Scheme were set at the level of

the qualifying scheme retirement age), is the amount that would be payable

to that person if that qualifying pension scheme were accepted into the

Pension Protection Fund.

(4)
The Secretary of State shall make such loans to the Lifeboat Fund as are

necessary to allow the discharge of its functions and in particular its

obligation to make supplementary payments under subsection (2).

(5)
The Secretary of State shall make such loans from time to time having

regard to—

(a)
requests for such loans received from the Board;

(b)
the amount of assets transferred or to be transferred to the Lifeboat

Fund under the Scheme (as defined in section (Transfer of unclaimed

assets) (“the Scheme”));

(c)
the level of any claims on the Lifeboat Fund in respect of assets

transferred to it under the Scheme.

(6)
Loans made in accordance with this section must be repaid to the Secretary

of State as soon as, in the reasonable opinion of the Board, it is prudent to

do so having regard to—

(a)
the obligations of the Lifeboat Fund;

(b)
the amount of assets transferred or to be transferred to the Lifeboat

Fund under the Scheme; and

(c)
the level of claims on the Lifeboat Fund in respect of assets

transferred to it under the Scheme.

(7)
Loans made under this section shall be interest free.

(8)
The assets of the Lifeboat Fund shall be held separately from the assets of

any other fund under the control of the Board.

(9)
The Secretary of State may by regulations make further provision in

connection with the Lifeboat Fund.

(10)
A statutory instrument containing regulations under this section is subject

to annulment in pursuance of a resolution of either House of Parliament.”

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COMMONS DISAGREEMENT AND REASON

The Commons disagree to Lords Amendments Nos. 1, 16, 17, 18, 23 and 24 for the

following Reason—
17A
Because they would involve charges on public funds, and the Commons do not offer any

further Reason, trusting that this reason may be deemed sufficient.

LORDS AMENDMENT NO. 18
18
Insert the following new Clause—

“Pensions Unclaimed Assets Recovery Agency

(1)
There shall be a body called the Pensions Unclaimed Assets Recovery

Agency (“the Agency”).

(2)
The Agency must be established no later than three months after the

passing of this Act.

(3)
The Agency shall consist of not fewer than six nor more than twelve

members to be appointed by the Secretary of State, and the Secretary of

State shall appoint one member to be the chairman, and another member

to be a deputy chairman, of the Agency.

(4)
In appointing a person to be a member of the Agency, the Secretary of State

shall have regard to the desirability of appointing persons who have

knowledge of, or experience relating to, matters relevant to the functions of

the Agency.

(5)
A member of the Agency may hold office for such a period as the Secretary

of State may determine, but not exceeding—

(a)
six years, in the case of the chairman, and

(b)
four years, in the case of other members.

(6)
The Secretary of State may make payments to the members of the Agency

by way of remuneration and make payments to them in respect of expenses

incurred by them in the performance of their duties.

(7)
The Secretary of State may also defray any other expenses of the Agency.”

COMMONS DISAGREEMENT AND REASON

The Commons disagree to Lords Amendments Nos. 1, 16, 17, 18, 23 and 24 for the

following Reason—
18A
Because they would involve charges on public funds, and the Commons do not offer any

further Reason, trusting that this reason may be deemed sufficient.

LORDS AMENDMENT NO. 19
19
Insert the following new Clause—

“Functions of Pensions Unclaimed Assets Recovery Agency

The functions of the Agency are—

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(a)
to obtain such information about such classes of unclaimed assets

as may be prescribed by the Secretary of State by regulations;

(b)
to provide the Secretary of State with that information and any

other related information held by the Agency which the Secretary

of State may from time to time require;

(c)
to administer the scheme to be established by virtue of section

(Transfer of unclaimed assets).”

COMMONS DISAGREEMENT AND REASON

The Commons disagree to Lords Amendments Nos. 19, 20 and 21 for the following

Reason—
19A
Because they make provision connected with that made by Lords Amendments Nos. 17 and

18, to which the Commons have disagreed.

LORDS AMENDMENT NO. 20
20
Insert the following new Clause—

“Pensions Unclaimed Assets Recovery Agency: provision of information

(1)
Subject to subsection (2), the Agency may, by notice, require any person to

supply it, within a specified period or at a specified time or times, such

specified information as the Agency considers it needs for the purposes of

carrying out its functions under section (Functions of Pensions Unclaimed

Assets Recovery Agency).

(2)
This section does not authorise any requirement in relation to information

to be imposed on any person unless that person carries on a business in the

United Kingdom; but a requirement may be imposed under this section on

a person in relation to information in the possession or control of a

connected person or undertaking outside the United Kingdom.

(3)
Any person who, when required to do so under this section, fails without

reasonable excuse to supply any information, shall be liable on summary

conviction—

(a)
to a fine not exceeding level 5 on the standard scale; and

(b)
in the case of a continuing offence, to an additional fine not

exceeding £200 for every day during which the offence continues.

(4)
Any person who knowingly or recklessly supplies any information which

is false or misleading shall be liable—

(a)
on conviction on indictment, to imprisonment for a term not

exceeding two years, or to a fine, or both; and

(b)
on summary conviction, to a fine not exceeding the statutory

maximum.”

COMMONS DISAGREEMENT AND REASON

The Commons disagree to Lords Amendments Nos. 19, 20 and 21 for the following

Reason—
20A
Because they make provision connected with that made by Lords Amendments Nos. 17 and

18, to which the Commons have disagreed.