Pensions Bill

This amendment would disable the new provision for HMRC to share information with the Pensions Regulator for compliance purposes and it would eliminate existing data-sharing arrangements between the two. I understand that that is not the import of the amendment but I thank the noble Lord, Lord Skelmersdale, for giving us the opportunity to discuss this matter. I am aware that lapses in data security in recent months have rightly caused great anxiety and wish to reassure noble Lords that we share that concern. I should like to explain why the data-sharing provided for in Clause 45 is vital and outline the steps that we are taking to ensure that the transfer and storage processes will be protected by the highest standards of data security. HMRC, through its PAYE responsibilities, is the only holder of a comprehensive UK employer database. These data will allow the regulator to communicate with employers about their new duties and to run a registration process requiring employers to state how they will meet their new responsibilities. Without registration, compliance with the employer duties would be much lower, and millions could be denied access to pension saving. In addition, this subsection is designed to allow HMRC to share information about non-compliance which it has collected through tax and national minimum wage activities. This will help the Pensions Regulator to identify which employers are more likely not to comply with their new duties. Finally, the clause replaces the regulator’s existing gateway to exchange data with HMRC, which is crucial to the regulator’s ability to deliver its existing functions. It is of course vital to ensure that data are transferred safely and securely. The Bill, and Clause 47 in particular, strengthens the legal safeguards of data shared by HMRC by increasing the maximum sentence that a magistrate can impose on Pensions Regulator staff who unlawfully disclose restricted data. This sanction also applies to anyone who unlawfully discloses restricted data which they have received from the Pensions Regulator. The noble Lord referred to secondments or transfers between departments, which we discussed to some extent during the passage of the Child Maintenance and Other Payments Bill. There may well be arrangements for people to be seconded from one department to another, but when individuals arrive in a transferee department, they will be subject to the same procedures, processes and systems as any other employee in that department. The fact that they may have come from another department does not matter. They may bring expertise and experience with them, but this is not meant to be a loop round what should be a formal gateway. The noble Lord also asked how the arrangement will work, particularly in relation to information related to non-compliance with the national minimum wage. The data-sharing arrangements have yet to be operationally finalised, but the clause will allow HMRC to provide the regulator with information regularly about employers who are not complying with other legislation. That could be at the request of the regulator or on HMRC’s initiative. Clearly, this needs to be formalised and procedures need to be set up. The key point is that that information flows on a structured basis and that it is protected. I hope that enables the noble Lord to withdraw his amendment.