Clause 123 - Effect of Board assuming responsibility for a scheme

Part of Pensions Bill – in a Public Bill Committee at 9:30 am on 30th March 2004.

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Photo of Mr Chris Pond Mr Chris Pond Parliamentary Under-Secretary, Department for Work and Pensions 9:30 am, 30th March 2004

The hon. Gentleman makes an important and relevant point. I am pleased to reassure him and the Committee that his concerns have already been dealt with in the provisions.

I do not think that there is anything between us on the issue of trustees' further liabilities. It has been made clear that once the board has taken over responsibility, it has responsibility. The clause provides that, where a transfer notice is given to the trustees or managers of a scheme, the effect of the transfer notice is to transfer all the property, rights and liabilities of the scheme to the board. The trustees or managers of the scheme are discharged from their obligations to the scheme and the PPF board is required to pay compensation to scheme members on an ongoing basis.

The amendment, however, would allow the trustee or managers of a scheme to be discharged from any

liabilities whatsoever relating to the scheme, and enable them to receive an indemnity and not be held responsible by the board for any consequences of their actions prior to the taking effect of the transfer notice.

The effect of schedule 6 is that only rights and liabilities of an occupational pension scheme transfer to the PPF. That does not include any personal liability of the trustees or managers in respect of their acts or omissions prior to the date on which the transfer notice was given. Prudent trustees should as a matter of course have indemnity insurance in respect of personal liabilities. The amendment would therefore appear to be unnecessary and I hope that with that reassurance the hon. Gentleman will feel able to withdraw it.