Clause 31 - Appointments by Regulator
Pensions Bill
11:00 am
Mr George Osborne (Tatton, Conservative)
These two probing amendments are designed to elicit information from the Government. They deal with the fees and costs of the trustee appointed by the regulator. I am sure that we shall have a broad debate later in our proceedings about where the cost of expert advice should fall and how we should deal with a situation in which professional fees are eating into the resources of a scheme, something that we have all come across.
Under subsection (2), the regulator can decide to charge an employer or a scheme—or both—for the costs of trustees. That is a change from the 1995 Act. Will the Under-Secretary explain the reason for that change? It could mean that considerable direct costs fall either on the scheme or on the employers, who may not be culpable for the problems of the scheme, yet may be required to pay significant costs. In the long run, the cumulative effect of that would be to discourage employers from offering final salary schemes, which we all accept is a trend and a problem. I tabled the amendments so that the Under-Secretary could explain how the expenses and fees of trustees appointed by the regulator will be paid, how the determinations of who should pay will be made and whether the decisions can be appealed against. What check will be made that the trustees are not charging unreasonable fees and that the regulator has not gone for the most expensive City firm to employ the most expensive trustees when they are not necessarily the people who are needed?