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Pensions Bill

The Minister is absolutely right that directors have to make such judgments every day, but the judgments that they make in year 1 could be completely overturned by economic circumstances. Let us take the example of retail. A year ago, retail businesses might have been having some difficulties, but none of them would have predicted the kind of retail environment in which they are now operating. Many household names are doing profit forecasts and are reporting losses, not just reduced profitability. In a relatively short period, financial circumstances can change. That change in financial circumstances could easily be construed as being something that was foreseeable. The concern is that, while the Minister says that ordinary transactions will not be judged with the benefit of hindsight, particular judgments of what is foreseeable will come to much the same thing. I am not sure that the Minister is really grasping the rapidity with which things move in the commercial world. Linked to that is the question of what directors are going to have to get clearance on. If there is any concern—there is concern because of the way in which the test is shifting through detrimental effect and the way in which the Government want to include a course of actions, rather than single acts or omissions—increasingly directors will be driven by their lawyers to queueing up for clearances all the time, or ordinary transactions will be inhibited. That is the nature of the concern, which I am not sure that the Minister has yet grasped.