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Pensions Bill

Consultation with both employers and members is essential to the success of the personal accounts scheme. The Bill requires the trustee to establish members’ and employers’ panels to ensure that the trustee corporation is informed of the concerns of these groups. This amendment would give the employers’ panel the right to nominate members to the corporate trustee in the same way as the members’ panel can. While the personal accounts scheme will emulate existing occupational pension schemes, it will be unique in scale. The members will be drawn from many thousands of employers and it is likely that many of these members will not have saved in a pension before, which is why it is particularly important that the members of personal accounts should feel a sense of ownership. All individuals who form the corporate trustee will have the core obligation to act in the members’ best interest, rather than to represent any particular interest groups. It will not be possible for the trustee to meet the duty of acting in the members’ best interest without taking account of the employers’ concerns. It is the employers’ panel role to ensure that it has the information to do this. It may be helpful to point out the different role of the employer in the personal accounts scheme. In a typical occupational pension scheme, the participating employer would set up the scheme. The personal accounts scheme is being set up specifically for those employers who do not currently offer access to a workplace pension. If an employer chooses to use the personal accounts scheme, he will not be involved in the running of the scheme. The main focus for employers using the personal accounts scheme will be its efficient administration. If an individual employer has any concerns or problems with the administration of the scheme, he can raise this with the administrator or through the employer panel. The role of the employer panel will be important; the panel will ensure that the views of the wide range and diverse nature of employers using the personal accounts scheme are heard. Ultimately, however, the members are the beneficiaries of the scheme, so they should have a greater stake in how it is run. It is for this reason that we have given only the members’ panel the right to nominate individuals to the trustees. We feel that this is the right balance. I ask the noble Baroness to withdraw her amendment.