The new Clause is another return to the simplification, or deregulation, agenda. It is very limited in scope; it is for a limited statutory override. One of the issues looked at by Messrs. Lewin and Sweeney in their review was statutory override. The Amendment is sponsored by the National Association of Pension Funds, and the background is the whole thrust of trying to limit or reduce the costs and burdens on sponsoring employers of existing defined benefits schemes. Those costs have gone up a lot in recent years. The latest NAPF annual survey showed that the administration costs of an average scheme have risen by over 50 per cent. in the last two years alone. That is a staggering figure.

The NAPF welcomes the Government’s rolling deregulation programme—rolling is just about correct, although it is not very fast. It says,

“we believe the Government could go further and accelerate the process”.

That is a marvellous piece of understatement. One way in which that could be done, would be to introduce a limited statutory override into the Bill. I have already touched on the work of the external deregulation reviewers. They identified a problem whereby some schemes are unable to take advantage of Government simplification measures, due to the way in which their own scheme rules are drafted. It is not the law itself  that stops them, it is their own scheme rules. The problem is about how that can be changed.

Lewin and Sweeney recommended that the Government should legislate to ensure that employers and pension scheme trustees can override their scheme rules in certain specific cases set down in the legislation. That would include the right to make changes to the indexation requirements introduced in the 2004 Act, and it should apply in other circumstances such as the revaluation in clause 79.

As we near the end of the Committee stage I may, for once, be pressing on an open door. The Government have said that they agree with the measure in principle, but they also believe that it should be possible to make such changes by secondary legislation. The NAPF does not entirely agree with that because of the complexity of the pensions set up at the moment. It believes that we should send what it calls a “strong signal of support” to those employers offering high-value occupational pension schemes—something that I entirely agree with. It says,

“the amendment...seeks to put the matter beyond doubt and provide a power—in primary legislation—which will enable the Secretary of State to make regulations to extend the Pensions Act 2004 indexation changes and those set down in clause 79 of this Bill regarding revaluation to all pension schemes.”

I have two final points that are important to put on the record.