Pensions Bill

moved Amendment No. 134ZC: 134ZC: After Clause 108, insert the following new Clause— ““Payments to employers In section 37 of the Pensions Act 1995 (payment of surplus to employer) after subsection (1) insert— ““(1A) But this section does not apply in the case of any of the payments listed in paragraphs (c) to (f) of section 175 of the Finance Act 2004 (authorised employer payments other than public service scheme payments or authorised surplus payments).”””” The noble Lord said: This amendment corrects an omission in the Pensions Act 2004. It introduces an exemption from the strict conditions that must be satisfied before the trustees of a trust-based occupational pension scheme can authorise a payment to the sponsoring employer from the funds of the scheme. These conditions are set out in Section 37 of the Pensions Act 1995, and they are commonly referred to as the surplus rules. There was, however, an exemption from this rule for administrative and certain other payments, allowing the trustees to make them without reference to the surplus rules. Unfortunately, this exemption was inadvertently not carried forward when Section 37 was substantially revised by the Pensions Act 2004. It was not our intention to remove this exemption, and an equivalent provision should have been carried forward. This amendment corrects the position through the introduction of an exemption that refers to payments listed in Section 175 of the Finance Act 2004; namely, compensation payments, authorised employer loans and scheme administration employer payments. It also refers to a regulation-making power that enables HMRC to extend the scope of authorised employer payments in particular circumstances. It has been necessary to update the precise wording of the exemption because Section 37(7) referred to tax legislation that has now been replaced as part of the major changes to the taxation regime for pension schemes introduced by the Finance Act 2004. This amendment will restore the longstanding position that was inadvertently removed by the Pensions Act 2004. I beg to move.