---

Financial Assistance Scheme Regulations 2005

That, again, was a very comprehensive review of these orders, which are the first fleshing-out of the skeleton Financial Assistance Scheme in the Act. Part 2 of the main regulations provides that schemes established in Part 1 should be managed by the Secretary of State, who will naturally delegate to officials. I shall have more to say about that in a moment. There is to be a fund consisting of taxpayers’ money to the tune of £400 million—whether this £400   million will come out all at once or in dribs and drabs I have yet to discover; perhaps the Minister will tell me—and money provided by third parties. This surely does not mean the money transferred from the schemes coming in; they already have those assets. My noble friend Lord Higgins and I pointed out in our discussions on the Bill—and, indeed, my noble friend made a note—that no one in their right senses would contribute to the scheme, but we still find that erroneous suggestion in the regulations. We have the Financial Assistance Scheme simply because the Government were bounced into it by their own Back-Benchers, who knew of many pensioners—some 60,000—who would lose out because their schemes would not be covered by the Pension Protection Fund. It was and is to be backdated to 1   January 1997, ending on 5 April 2005, the date of the establishment of the PPF. However, although the PPF was established on 5 April, it is still, as I understand it, not up and running properly. My guess is that it will take well over a year for that to happen. I noted the Minister’s hope that payments from the FAS would be made sometime in September. I hope that he is right, but my experience of such matters is that it can take quite a long time. How can we tell whether there is a black hole into which schemes might fall—or, indeed, whether there is no black hole but pensioners still lose out? Will—or indeed does—the PPF make it a priority to take over schemes which are in the process of failing due to an insolvency event? Clearly we have now run out of time for the FAS to take account of such schemes. After all, I am sure there are some schemes where the employer has suffered an insolvency event. What, for example, about the former employees of the Rover car company? Did that firm collapse—in a technical sense rather than in the way we read of in the newspapers—before 5 April or after? One of the much-vaunted criteria of the scheme was that existing pensioners would continue to get paid, although, from my reading of Schedule 2, not as much as they did before the employer collapsed. Indeed, the Minister has said as much today. Will there be an interruption in their incomes or will they continue to be paid on the normal day? What about new pensioners? If there is a delay in payment and if the first payments are not coming through until September, how will those unfortunate people who are waiting for their pensions continue to survive? Will pension credits, for example, be available, or does the department have in mind some other mechanism? These are questions that current, deferred and future pensioners want answered. If the noble Lord cannot answer now, I should be grateful if he would write to me on the subject. As to the internal review regulations, there clearly has to be an appeal mechanism, which again will be delegated to officials. They will determine whether the criteria in Regulation 2 have been met. I have no questions on the procedural details of the arrangement but it is, of course, important that the review decision is not made by the same official or officials who made the determination in the first place. I hope the Minister can give me that guarantee. After all, in other parts of the social security system that is exactly what happens. A different bunch of officials, if I may describe them in such a way, carries out the review process. I also notice that the scheme manager must take reasonable steps to publicise the results of the review to any interested person. While I applaud the intention, how is this to be achieved? How will it be possible to detect these interested persons? How and where will the Secretary of State publicise his determinations? Clearly we shall be watching the development of this scheme very carefully. I hope the Minister will be able to satisfy us that it will work—and work fast—otherwise the Government will have scrambled out of one hole and into another. In this case, I wish the Government well because I do not want that to happen.