Jeremy Browne (Taunton, Liberal Democrat)

I beg to move amendment 12, in clause 21, page 9, line 39, leave out ‘£300’ and insert ‘£3,000’.

Good morning, Mr. Taylor. We just passed clause 19 rather quickly, but Members who look at it will see that it includes a provision for imposing a £3,000 penalty on account holders who break the rules. We have just agreed to put that into effect.

Clause 21 sets out the penalties and sanctions for account providers if they break the rules, but we can see if we compare clause 19 with clause 21 that, whereas an account holder can be fined up to £3,000 for violating the rules, an account provider can be fined only one tenth of that amount—£300. There is a long list of rules that they are compelled to keep—nine of them in subsection (1). It would seem reasonable that account providers who break the rules should be subject to the same penalties as account holders who break the rules. That is the purpose of my amendment.

Ian Pearson (Parliamentary Under-Secretary (Economic and Business), Department for Business, Enterprise & Regulatory Reform; Dudley South, Labour)

It might be helpful if I explain that the penalty regime for saving gateway accounts has been modelled closely on the one for child trust funds, as the schemes share several common features. We have not experienced any difficulty with the operation of child trust funds, and this penalty structure closely mirrors that one. The penalty will not exceed the greater of £300 or £1 per account affected. Saving gateway providers may also be child trust fund providers, so having the same penalties will provide consistency.

In any event, we consider that setting the penalty at £300 is proportionate in all circumstances. Banks and other institutions that may offer saving gateway accounts—there are other providers of child trust fund accounts, including credit unions—will be familiar with this regime. We do not expect it to cause any complication and so do not believe that the amendment is necessary. I ask the Committee to resist it.

Jeremy Browne (Taunton, Liberal Democrat)

I wanted to test the water on that one. It was helpful to hear the Economic Secretary’s comments, although the situation still seems somewhat anomalous. I hope that there will be no violations and that we will therefore never find out whether the anomaly would be keenly felt by my constituents. With that, I beg to ask leave to withdraw the amendment.