1. In my letter to you on 4 June I explained that I would be tabling Government amendments with regulation making powers and that in line with DPRRC guidance I would submit supplementary memoranda to the Committee. I am now writing to you again to draw your attention to the first set of Government amendments with delegated powers which I believe may be of significant interest to the Committee and I attach, at annex A, a supplementary memorandum as well as the amendments at annex B [not printed].
2. The attached supplementary memorandum identifies the delegated powers conferred in the new Government amendments I am tabling. It explains the purpose of the powers, the reasons for using delegated legislation, whether the powers are subject to Parliamentary scrutiny, which procedures apply and the justification of these procedures.
3. The Department has followed the precedent in pensions legislation by setting out the overall legislative framework on the face of the Bill but giving the Secretary of State, in certain circumstances, the power to provide detailed provisions in secondary legislation. This is due partly to the fact that it is considered inappropriate for Parliamentary time to be spent on every detailed provision during the passage of the Bill; but is also a reflection of the fact that the content of such provisions may change from time to time, for instance, in view of changing social economic circumstances. It is desired to avoid amending the primary legislation on each such occasion.
4. I thought it might be helpful if I briefly summarised the Government amendments discussed in the attached memorandum. I believe the Committee will have an interest in:
Regulation making powers contained within amendments to clauses 3, 5 and 6, which will enable automatic enrolment and re-enrolment into workplace personal pensions (WPPs). Regulation making powers in clause 16 and in a new clause after clause 25 will allow the prescription of further criteria to enable personal pension schemes to qualify for automatic enrolment, and ensure that in order to support the automatic enrolment process information is provided to relevant persons, in particular relating to the scheme into which a jobholder is being enrolled into.
New powers at clause 23 to modify the defined benefit and defined contribution quality requirements for hybrid schemes.
5. I would also like to take this opportunity to draw the Committee's attention to those areas on which I will be submitting further supplementary memoranda. The drafting of the relevant amendments is currently being finalised, but it is our intention that these memoranda will cover amendments with regulation making powers relating to:
Amending an existing power in the Pensions Act 2004 by extending the circumstances in which the Pensions Regulator can contract out its functions if it so chooses.
Prohibiting employers coercing or offering inducements to a worker to opt out of their pension scheme.
Ensuring the measures in the Bill impact appropriately on seafarers and offshore workers.
Allowing the Department to set out a clear framework to share specific customer data with energy suppliers in order to target low-income pensioners who may be eligible for savings on their fuel Bill.
A new clause before clause 105 that will allow the PPF to recover the reasonable costs of implementing a Pension Sharing order (made on divorce or dissolution of a civil partnership) which is made before the PPF assume responsibility for a scheme.
An amendment to clause 106 in relation to the Financial Assistance Scheme (FAS). These will ensure that FAS payments are made to those who, due to current restrictions, would not otherwise be entitled. The amendment also contains measures to allow underfunded schemes with solvent employers into the FAS.
6. In line with DPRRC guidance I aim to submit further supplementary memoranda to the Committee in advance of tabling the amendments to which they refer.
7. Finally, I previously committed to providing the Committee with the text of those Government amendments which will enable the Bill to comply with the recommendations the Committee made in their Ninth Report of the 2007 - 2008 session. The first of these amendments are at annex C. I will send the remaining amendments which make changes to the Bill in light of the DPRRC's recomendations as soon as drafts are available.
8. I have provided copies of this letter to L Secretariat and the Lords Whips Office.
