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Pensions Bill

My Lords, I start by paying tribute to the Aegis Trust for its valuable work on the amendment. From the Liberal Democrat Front Bench I thank my noble friend Lady Northover and my noble friend Lord Joffe—if I am allowed to call him that—with whom I have long and happy experience of working on charitable matters. This is an important principle and we on the Front Bench are sympathetic to it. I think it is fair to say that the debate has probably moved on a little since Committee. We particularly welcome the detailed and very inclusive discussions that we know the Minister has been having with both the movers of the amendment and PADA in particular. We are concerned to ensure that such changes do not add significantly to costs or make the operation of PADA more complicated, because obviously it must be a simple, low-cost scheme. However, we believe that these are sensible points for PADA to consider. To be honest, I would define a little more widely why I think the cost argument might favour something such as this amendment. Even over the past few months, we have seen how the operation of pension funds can facilitate the wrong sort of activity—and very damaging activity—in markets. I would define social responsibility also to include things such as not facilitating the activities of short-sellers and hedge funds, and being very careful about stock-lending, for example. In the past few weeks, we have seen what I can only call the short-selling wolves in bank shares feeding on fears and causing great distress and problems for the country. That sort of thing needs to be included within good governance in relation to ethical investment. The other point on costs—I find this most distasteful—is that a series of companies have announced that they are to move their headquarters to Dublin from this country for tax purposes. Often it is just two men and a dog and is not really moving but it is clearly tax-dodging. To me, that is also bad governance and should be considered in relation to ethical investment. I am particularly concerned about Henderson, which is an old established, pukka British fund manager. It is the same family that founded Cazenove. It runs many billions of pounds in ethical funds for British local authorities, charities and public bodies, yet it has just announced that it is to move its headquarters to Ireland for tax purposes. How socially responsible is that? Therefore, if as part of our consideration of the Bill we can try to stop people doing that sort of thing, we will save costs. We will recover some costs for the benefit of British taxpayers and pensioners in general. We are very concerned to keep things simple. We know that the Minister has been engaging in this and we look forward to hearing what he has to say but we think that the mover of the amendment made some good points.