---

Pensions Bill

moved, as an amendment to Amendment No. 130EW, Amendment No. 130F: 130F: Before Clause 107, line 16, at end insert— ““( ) Regulations under this section may not make provision enabling a relevant notice to be issued to an individual.”” The noble Lord said: One of the declared intentions of the Government is that the test should move from intent to effect. My contention in this amendment is that under those circumstances it would be unfair to pursue individuals. If something goes wrong and the circumstances of a company change, it may well be necessary to revisit, say, the payment of a dividend or some other transaction which was made not with the intent of reducing the money available for a pension fund but certainly with that effect. For example, the dividends that house builders have paid over the past five years have certainly had that effect, because they now find themselves with very little market capitalisation and very large pension fund deficits. Why would it be right, under those circumstances, to pin that liability on relatively rich individuals who happen to be directors of those companies? Perhaps they are non-executive directors who have come to give their expertise to the company, or the original proprietor who made money when he sold out to a public group. Why should that money then be available when it is not questioned that the decision to pay the dividend was taken with no intent to do down the pension fund—indeed, when life seemed pretty good and the sailing was plain? I understand the motivation behind the Government’s wish to change, but to extend that effect to individuals, particularly directors, will over time destabilise companies with defined benefit funds. If an individual is pursued for something they did with good intent, the knock-on consequences could be extremely severe. I beg to move.