Welcome again to our deliberations, Mr. Cran.
I was in the process of referring to comments made by the National Association of Pension Funds. We have already dealt with the amendments to the clause, and I was referring to the overlap of the old minimum funding requirement valuations with the transitional provisions and the first actuarial valuation under the new system. The association wanted to put the word ''material'' before the word ''developments'' in clause 181(2)(c), and I would have tabled an amendment to that effect if I had received the briefing in time. That point is self-evident, so I will not bother explaining it.
The NAPF is a little concerned about the phrase
''within seven days of . . . receiving it'',
in subsection (7). It says that the phrase ''as soon as reasonably practicable'' would make more sense, and that it is important that trustees or managers have an opportunity to see and consider the valuation report at least as soon as the employer does, which is a fair point. That very phrase appears elsewhere in the Bill, so it is not unfamiliar to the draftsmen.
Good afternoon, Mr. Cran.
I shall deal with some of the hon. Gentleman's specific questions. He asked whether trustees should make an actuarial valuation or report available to the employers as soon as is reasonably practical, instead of within seven days of receiving it. However, clause 181 carries forward a similar requirement to the legislation that currently applies to the minimum funding requirement. It is important to ensure that the employer is kept fully informed at key stages of the valuation process. It is appropriate to ensure that that seven-day period applies equally to the new scheme funding provisions, so we would like to stick to it.
On the question whether schemes must do a scheme-specific valuation straight away, we will ensure that appropriate arrangements are in place to allow schemes to make a smooth transition to the new requirement. Those arrangements will be set out in regulations, and we will consult on the detailed proposals before the regulations are introduced. We intend that there will be a transitional period to allow
schemes to maintain the three-year valuation cycles if they wish to do so.
The hon. Gentleman also asked whether the requirement for actuarial reports should be restricted to covering material developments since the last valuation. We do not believe that such a restriction would be necessary or appropriate. The European pensions directive requires actuarial reports to cover developments in the schemes' technical provisions and changes in the risks covered. The detailed framework for the calculation of a scheme's assets and technical provisions will be set out in regulation. We will consult interested parties as we finalise those detailed requirements.
Question put and agreed to.
Clause 181, as amended, ordered to stand part of the Bill.