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Pensions Bill

First, I make it clear that we fully intend to respect the purpose and intention of Clause 242 of the Pensions Act 2004; that is, to have one-third of the individual members of the trustee corporation nominated in some way by the scheme members. I say ““in some way”” not to be deliberately vague, but because the personal account scheme is unlike other occupational pension schemes. It will not have a sponsoring employer, or even a group of sponsoring employers. The personal account scheme is expected to have millions of members who work for many thousands of different employers. This puts the scheme in a unique situation with regard to contact with the scheme’s membership. Turning to Amendments Nos. 112F and 112H, tabled by the noble Baroness, PADA has been set the task of designing the process for interaction between the trustee corporation and the scheme members, and the process for trustee recruitment. Until we receive PADA’s advice on these processes, we will not know if we can simply amend Clause 242—or regulations under it—to include the trustee corporation, or whether we need to design a bespoke solution, such as nomination via the members’ panel, which we would set out in the scheme order. This is our reason for using the word ““may”” rather than ““must”” in both this paragraph of Schedule 1 and in Clause 60(4). We need this flexibility. When we have all the relevant advice and information, we will make the appropriate decision based on it. As I have previously said, the trustee corporation is the sole corporate trustee and it must act in the best interests of the scheme members, within the terms of the trust. They cannot have special interest groups to represent. In relation to the specific number of prospective members, under trust law, as I am sure noble Lords are aware, a trustee’s most important job is to protect the interests of beneficiaries under the trust. In this case, those interests are the pension savings of the scheme members. A trustee should not be directly required to act in anyone else’s interests. Prospective members are, of course, important to the trustee corporation and the future viability of the scheme. For this reason, the trustee corporation will work with members and participating employers, through the panels, to ensure that the scheme is running smoothly and that any issues are resolved. In this way, we will make the scheme as attractive as we can both to new employers and members, within the limits set down. I hope I have indicated that, in principle, we are entirely at one with the noble Baroness, Lady Noakes, but the steps of setting up the scheme are such that the way we have put it in the Bill so far is the right way forward to achieve the principle of Clause 242.