My Lords, the amendments relate to the speed with which the first review of the rate can be conducted. Initially, I will focus on Amendment 65 and the related consequential Amendments 64, 66, 72, 74, 78 and 87.
The amendments would accelerate the conclusion of the first review in four ways: first, by replacing the need for the Lord Chancellor to consult the expert panel with a requirement to consult the Government Actuary, thereby simplifying the preparation for the first review. Secondly, by reducing the maximum period within which a review must be completed from 180 days to 140 days. Thirdly, by requiring the Lord Chancellor to consult the Government Actuary within the first 20 days of the review starting. Fourthly, by reducing the time for the Government Actuary to carry out his or her review following the Lord Chancellor’s request, from the 90 days currently afforded to the expert panel in the Bill to 80 days. The remaining changes made by the amendments, including the obligation on the Lord Chancellor to publish information about the Government Actuary’s advice, are consequential to these four changes.
The Government have made clear on several occasions that they are committed to starting and completing the first review as quickly as practical after Royal Assent. The amendments will assist the achievement of that objective because they will remove much of the uncertainty that would exist as to the readiness and availability of the as-yet-unknown members of the panel to commence the review promptly. This means that the open-ended period for the request to the panel can be confined to a specified period.
In addition, the carrying out of a review by the Government Actuary rather than a panel is administratively and substantively a simpler proposition. The overall period for the review and the period for the Government Actuary’s response can therefore both be shortened. The proposal that the Lord Chancellor will make the determination on the rate within 140 days of the start of the review, and that the Government Actuary will respond within 80 days of the Lord Chancellor’s request, recognises these changes in the proposals. The amendments do not affect the timing of the commencement of the review.
However, the removal of the panel from the first review reverses a policy decision that the Government took when replying to the Justice Select Committee’s recommendation to involve the panel in the first review. The reversal of this decision is not something that the Government would do lightly—but, having listened to strong arguments from noble Lords across the House that the first review needs to be completed more quickly than would be possible if the panel had to be constituted, the Government accept that the proposed approach is a sensible and pragmatic step. We have spoken with the noble Lord, Lord Sharkey, and are grateful to him for agreeing some changes from the terms of his initial proposal in Committee. On this basis, the Government are content to accept Amendment 65 and the related consequential amendments.
Turning to the other amendments in this group, the effect of Amendment 51 and the related Amendments 52, 55, 58 and 59 would be to require the first review to be started within 25 days of commencement, rather than the maximum 90 days as provided for in the Bill at present. Amendment 90 would be even more restrictive on the time allowed, as it would require the timetable for the first review to begin on the date of Royal Assent. As I have explained, we share noble Lords’ desire to ensure that a review is carried out as quickly as is reasonably practical. However, reducing the period within which the Lord Chancellor must begin the first review—which is a maximum period that may well be bettered in practice—runs the risk of creating unnecessary problems around compliance with time limits for those involved in translating this legislation into action. This is particularly the case given the Government’s acceptance of the reduced time limits in Amendment 65.
Even though the review will no longer involve the expert panel, there is still a need for extensive pre-review research and analysis to be completed to enable the Government Actuary to provide input to the review on a fully informed basis. This will include developing the data requirements to inform a call for evidence on investment advice and behaviour, funds available to investors and their risk characteristics, and allowances for tax and investment management costs; preparing and publishing the relevant call for evidence documents; and collating and analysing the responses. While we will ensure that the gathering of evidence proceeds as quickly as possible, that work will require time and it is important that it is done properly. At present we estimate that it will be completed around the end of November, but there is a possibility that the Bill may achieve Royal Assent earlier than expected.
The Government are, however, sympathetic to exploring ways to reduce the 90-day period within which the first review must begin, without making the period so short as to cause problems for the rest of the timetable. In light of this we would be happy to discuss the detail of these amendments further with noble Lords before Third Reading if they would be willing to do so. I hope that this commitment will reassure noble Lords that the Government are prepared to examine how the 90-day period following commencement might be reduced and, on that basis, I urge them not to press their amendments.