Pensions Bill

My Lords, I add to the chorus by saying that I am delighted by what the Government have done—it is great progress. Although I have tabled many detailed amendments, they focus on one matter, which is the code and how secure people can be in the belief that the matters in it are those to which the material detriment test and other aspects of the amendment will apply. Anybody involved in the activities set out in the code, unless they are of criminal intent or do not have their heads screwed on, should know that they should seek clearance for them, or they should read the regulations extremely carefully and make sure that they do everything by the book. But if it is possible to go outside the code and trespass on other areas of ordinary commercial life or other sorts of transactions, the protections offered by this structure become much less relevant—all the defence that is there of having gone through the proper processes to make sure that you have not caused detriment. If you thought that this was not a matter that would ever come under these provisions you would not have done that. Your records will not be in place and you will be in deep trouble. As the Minister said, you cannot fetter the regulator's discretion. It will be a big matter how individuals view this and how they are advised to view this; whether they are told by their lawyers, ““Look, this is something that is reasonably safe and I would not worry about it too much””, or ““You are doing something every day that might attack the pension fund”” and you will have to get clearance every time you breathe out, near enough. The voices that are coming from the lawyers are going in that direction. The Minister says that he expects there to be a peak in applications to the regulator soon after these provisions come into force and that with experience they will relatively quickly die away, as they did when these provisions were first introduced in the previous Act. I hope that that is right. To a large extent, we trust the judgment of the Minister and his officials that they have things right in that regard and that is the way that things will actually work. But the Minister needs to say more about the circumstances under which he sees the regulator going outside the code to use the powers that are in this amendment for something that does not fall within the sort of transaction set out in the code. There is a considerable worry out there, particularly among those people who are involved in trying to sort out companies in difficulties who have to move fast and take rough and ready decisions to make things work. They have to take risks, although they often do not benefit enormously from doing so. They are not in there to make a great capital gain from themselves but as hired hands to put out the fire. They will be taking enormous risks under the terms of this amendment, and it comes down to, will the regulator stick within the code or start running outside? If the Minister could give us as much comfort as he can that he cannot see circumstances where the regulator would need to go outside the code, that would be a great help in calming people’s fears. There is a worry that the regulator might choose an unexpected opportunity—perhaps not that serious an opportunity—to solve a particular problem by saying, ““I have seen the code but I don't feel like being bound by it in these circumstances””.