---

Pensions Bill

moved Amendment No. 110G: 110G: Clause 60, page 31, line 6, leave out ““members’ panel”” and insert ““panels”” The noble Baroness said: Clause 60(4) states: "““The functions of the members’ panel may include nominating individuals to be members of the trustee corporation””." I am not sure why the Bill needs to say that, because I thought that subsection (3) was wide enough to allow that. We obviously support members being on the panels, although we hope that the trustee board does not become packed with special interest members flying under the broad banner of members’ interests. Given that the Government have chosen to put this in the Bill, the question is naturally raised as to why there is no mention of the employers’ panel nominating individuals to be members of the trustee corporation. In another place, Mr O’Brien, the Pensions Minister, said: "““Employers should not be represented on that board, because the trustees are all there to represent members’ interests””.—[Official Report, Commons, Pensions Bill Committee, 31/1/08; col. 320.]" That rang alarm bells with me. We fully accept that the main duty of the trustees will be to work in the interests of members, but that duty cannot be seen in isolation. If the way in which trustees conduct themselves is contrary to employers’ interests, that can only store up problems for the personal accounts scheme overall. When employers set up their own trust-based pension schemes, whether for DB or DC purposes, they draw up the documentation that sets out the various rights and obligations of the employers and the trustees. To my knowledge, that usually, if not always, includes the power of the employer to appoint some of the trustees. Of course, the trustees are there to act in the interests of the members, like all trustees, but they provide a conduit for the views of the employer. That occasionally causes difficulties in practice, but, overall, it provides many benefits to the efficient working of those schemes. I do not know a single employer with those arrangements who would want to operate in any other way. Of course, the personal accounts scheme is different. It is the default scheme and the voice of the employer at the trustee board will be less specific in nature than is found in an employer’s own scheme—but so, too, will be the voice of the member. Both will be represented by representative groups. It seems to me that if something needs to be raised about how issues may affect employers versus employees, it is best that that is played out at the trustee board, rather than to have some key players in the whole success of this scheme being excluded. I believe that it should be possible for employers’ representatives to be on the trustee board and that the use of the panels as the nominating mechanism is useful. I hope that the Minister will share my view that a trustee board that excluded the voice of the employer in its entirety would be likely to work against the overall success of the personal accounts scheme. I hope, therefore, that he will accept my amendment. I beg to move.