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Pensions Bill

moved Amendment No. 130ZB: 130ZB: Clause 93, page 46, line 23, leave out subsection (2) The noble Lord said: I shall speak also to government Amendments Nos. 130ZC, 130ZD, 130BZA, 130BZB, 130BZC, 130BAA, 130DA, 130DB, 130DC, 130DD, 130DE, 130DF, 130DG, 130DH, 130DJ, 130DK, 130DM, 130DN, 130DQ, 130DT to 130EK and 140A. Before I explain the purpose of the amendments in detail, I thought it might be helpful to offer a brief reminder of the content and purpose of this chapter. Since 1997, the Government have been committed to ensuring that divorcing couples can reach fair and equitable financial settlements. As part of that, in 1999, we legislated to enable couples undergoing a divorce or annulment to share pensions where that was appropriate to their circumstances. In 2004, we extended that in the Civil Partnership Act to couples who were dissolving a civil partnership. Although I shall refer mainly to divorce throughout my speech, the provisions being introduced refer equally to divorce or the dissolution of a civil partnership or an annulment. When couples divorce they can, if appropriate, share their pensions like other assets in a way that ensures a clean break, and thus independence of income in later life. Where a person undergoing a divorce has pension rights, the court can transfer the value of some or all of those rights to their former spouse. That former spouse can then buy a pension of their own to ensure that they have independence and security. The courts can also do this while a pension scheme is being assessed for transfer into the PPF, but once a pension scheme has transferred, things change. As pointed out by my noble friend Lady Hollis during debate on the Pensions Act 2007, unlike cash, property or pensions, pension compensation cannot be shared even if a couple or court decide that that would be the best way of dividing their assets. Where compensation is the only significant asset belonging to a divorcing couple, that could mean that one party was disadvantaged. To avoid such a situation and ensure a fair and equitable settlement, Clauses 91 to 104 ensure that sharing pension compensation is an option. These government amendments are about ensuring that the compensation-sharing provisions operate as effectively as possible. I hope that Members of the Committee will bear with me as I go through this rather long list of amendments, all of which are important. Amendments Nos. 130ZD, 130BZC, 130BAA, 130DA, 130DT, 130DU, 130DV, 130DX, 130DY and 130DZ—the first batch—amend Clause 94 and Schedule 4. They are intended to ensure that the compensation-sharing provisions operate appropriately where a person has entitlement to compensation resulting from membership of more than one scheme that has been transferred to the PPF. They do this by allowing the courts to make a sharing order that relates to the individual parts of a person’s compensation where appropriate. They also provide for the PPF to calculate compensation accordingly. Amendments Nos. 130DC, 130DF, 130DG, 130DH, 130DM, 130DN and 130DQ—the second batch—amend Schedule 4. They ensure that the provisions relating to compensation paid to survivors on the death of a member apply equally to surviving civil partners, other partners, widows and widowers. They do so by ensuring that references to ““widow”” or ““widower”” are replaced by ““surviving partner””. Amendments Nos. 130DD, 130DE, 130DJ and 130DK—the third batch—amend Schedule 4. They ensure that compensation is calculated correctly by not reducing compensation to the 90 per cent level where the transferor’s compensation would already have been reduced. They amend the provisions so that the calculation of compensation following a compensation share does not include inappropriate reductions to 90 per cent. Amendments Nos. 130DW and 130E—the fourth batch—amend Schedule 5. They are intended to ensure that discharged attachment orders do not prohibit a compensation share or further attachment. They do this by specifying the circumstances in which an outstanding attachment order prohibits a fresh order being made. Amendments Nos. 130EH, 130EJ, 130EK and 140A—the fifth batch—amend Clause 104 and Schedule 9. They will ensure that the board of the PPF can make payments to the fund to meet its liabilities to pay compensation following a pension compensation share by amending the provisions in the Pensions Act 2004, which specifies which payments may be made out of the fund. The remaining amendments, Amendments Nos. 130ZB, 130ZC, 130BZA, 130BZB, 130DB, 130EA, 130EB, 130EC, 130ED, 130EE, 130EF and 130EG amend Clauses 93 and 94 and Schedule 6, and introduce a new clause after Clause 93. The noble Lord, Lord Kirkwood, will be pleased to hear that all the amendments relate to Scotland. They will make sure that the compensation sharing provisions operate properly in Scotland. I thank noble Lords for their forbearance in allowing me to explain these complicated amendments. I hope that they receive noble Lords’ agreement, but I shall seek to explain them further if required. I beg to move.