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Pensions Bill

moved Amendment No. 112S: 112S: Schedule 1, page 59, line 8, at end insert— ““(1A) The trustee corporation must establish a committee in order to keep under review the question whether the corporation’s internal financial controls secure the proper conduct of its financial affairs.”” The noble Baroness said: I shall speak also to Amendment No. 112T. Both amendments concern an audit committee for the trustee corporation. This ought to be uncontroversial. The Minister knows that when I say that, I am heading for a small disagreement with him. When we get to Clause 74 we will find that the Personal Accounts Delivery Authority will be setting up a non-executive committee which, inter alia, will keep an eye on PADA’s internal financial controls in securing the proper conduct of its financial affairs. That is what audit committees very broadly do—throughout the corporate world, and pretty much the public sector as well. Why is there no equivalent for the trustee corporation? Of course, the corporation will be comprised of non-executives, and so a group delineated in the way that is being set up for PADA would be inappropriate. However, it should still be necessary—indeed, it should be vital—for an organisation such as the Personal Accounts Delivery Authority to have an audit committee. Internal financial controls are obviously important in any organisation but this one will have huge sums of money related to a very large number of transactions, which in turn will relate to a very large number of individuals. The controls need to operate effectively not only at the level of the whole corporation but also at the level of the individual; clearly, they need to operate so that an individual’s pension entitlement is correctly calculated. Therefore, Amendment No. 112S alters paragraph 9 of Schedule 1 so that the power to establish committees is modified. There would have to be a committee looking at financial controls. Amendment No. 112T adds an annual reporting requirement to paragraph 17, and the work of the committee that I have just described should be included in the annual report. That is standard practice and also mirrors what PADA will be doing by virtue of Clause 74. I hope that the Minister will agree that this is a no-brainer. I beg to move.