Occupational Pension Schemes (Contracting-out) (Amendment) Regulations 2009

I thank each noble Lord for their contributions. I do not have data to hand on the number of schemes that have been contracted out, but I will dig them out and write to the noble Lord, Lord Skelmersdale. He suggested that the schemes would already have converted GMPs. They could not, however, because it is the legislation that was inserted into the recent Pensions Act and these regulations provide the wherewithal to do that. The GMPs had to be preserved, even though, as he suggested, there are no longer accruals post-1997. The noble Lord, Lord Oakeshott, asked why this is being done now. I accept what both noble Lords say; this is complex stuff, which is partly to do with simplification. The noble Lord, Lord Oakeshott, is absolutely right that the legislation is impenetrable. That is why we have taken action, certainly so far as DC schemes are concerned. As the noble Lord will be aware, we are going to abolish contracting out for those schemes very shortly. The Turner commission report expanded on the reason for not doing this more immediately for DB schemes. There needed to be a period in which the long-term effects of removing GMPs and removing contracting out had to be reflected in those arrangements. The Turner commission was pretty clear that they could be phased in over time. As the noble Lord knows, this is due to expire by 2030. As we generally squeeze out the earnings related part of S2P, there will be a diminishing earnings related part to contract out.