I think that PADA expects to have sufficient information on which to base its decision by the end of the consultation on the charging structure. The consultation will come to an end and there will be a period of deliberation in response to that, which will provide further time. During that time, sufficient information will become apparent to give it a basis for reaching a decision.
The hon. Members for Eastbourne and for Rochdale both referred to what I might call the competition between the trustee scheme and commercially provided schemes on the question of whether it is appropriate to have any degree of public funding. However, one crucial difference needs to be underlined. When giving evidence to the Committee, Paul Myners said:
“We have a universal service provision obligation.”——[Official Report, Pensions Public Bill Committee, 15 January 2008; c. 14, Q14.]
That makes it different from the commercial sector provision. The schemes cannot pick and choose who they take on; they have to take everyone. That fundamentally alters the nature of those pension schemes, putting them in a different situation with respect to charges and running costs, and ultimately returns, to privately provided purely commercial pension schemes, which can exercise far more choice in that respect.
The personal account scheme is therefore unique, but we should not underestimate the challenges that the authority will face when setting it up and developing it. As I said, it is the largest occupational pension scheme in the United Kingdom. When up and running it could easily have as many as 7 million active members. It will be specifically targeted at those who do not have access to a good, low-cost workplace pension scheme; and as Mr. Myners said it cannot pick and choose its customer base.
Once the authority has developed the scheme and its procurement strategy, it will provide advice on the funding solution that provides the best balance between commercial viability and low charges—and I accept that the charges will be important to making the scheme successful. However, all that work can happen only once the authority’s powers have been extended under the Bill, so that it can take the next steps to implementing the scheme. It is therefore important that we do not second-guess the outcome of its work—nor, as the amendments do, should we place undue restrictions on the authority in its consideration of the funding strategy.
It is common practice—the hon. Member for Rochdale alluded to the fact—to take broad powers to finance a non-departmental public body involved in a major project, especially such a one as this in respect of personal accounts. However, I stress that it does not mean that any of those specific powers will necessarily be used. It simply ensures that the authority has the flexibility to identify the funding strategy that provides the best deal for members. In my view, it would be wrong to fetter the development of the best funding solution by insisting on the removal of a potential approach to delivering that financial support.