§ 5.48 p.m.
§ Lord Mackay of Ardbrecknish rose to move, That the draft regulations laid before the House on 28th January be approved [11th Report from the Joint Committee].
§ The noble Lord said: My Lords, I think that my speech on these regulations will be even less controversial than my previous speech and certainly a lot less controversial than my answers to the fourth Question at Question Time.
§ It may help if I begin our discussion of the register regulations by noting that in the past similar regulations, which introduced criminal penalties, were subject to the negative resolution procedure. Such regulations are, however, now subject to the affirmative procedure. The change was made to ensure that your Lordships' House could give appropriate consideration whenever a criminal penalty was being introduced. That reflects concerns expressed by the Select Committee on the Scrutiny of Delegated Powers and in the House of Lords itself during the Committee stage of the Pensions Bill.
§ Perhaps I may give some background information about the register and its operations. The register was established in 1991 and the records detail both occupational and personal pension schemes. The registration process provides basic information on individual schemes. That enables the registrar to provide a scheme-tracing service. The registrar also collects the pension schemes levy.
§ The tracing service is particularly important. Many individuals with preserved pension rights tend not to focus on them until they approach retirement. Someone who has lost contact with their scheme can contact the registrar and have the scheme traced through the register database.
§ The Register of Occupational and Personal Pension Schemes Regulations 1990 govern the register's operation. In practice the register works well, but while 501 We have retained most of the existing provisions we have also taken the opportunity to simplify the registration process. We are extending the time limit allowed for schemes to report changes to the registrar from six months to 12 months. This should mean that schemes will be able to notify changes at the same time as they make their annual levy payments. That keeps the administrative burdens for both the scheme and the registrar to the minimum.
§ The regulations also need to be amended because of changes introduced by the Pensions Act. First, we need to appoint the Occupational Pensions Regulatory Authority (OPRA) as the new registrar from April 1997 in place of the Occupational Pensions Board. Secondly, we need to amend the regulations because of the introduction of the new general and the compensation levies. The regulations also change the requirements about disclosing information from the register. At the moment, those engaged in research are allowed direct access to the register database. That has raised concerns about confidentiality, particularly in relation to the data protection legislation.
§ We propose that in future only the registrar's staff will have the right to inspect the register. However, we recognise that the register is the only source of information of its kind about pension schemes and it would not be right to limit the dissemination of this information where there is a legitimate reason for it to be provided. So the registrar will now be able to provide information for statistical analysis direct to any organisation or individual.
§ As well as offering the free tracing service for scheme members, the registrar will continue to provide information free of charge to the pensions ombudsman and to trustees about their own schemes, if requested. We also consider that the register is an important source of information for other bodies. The regulations therefore prescribe that information can be given to OPRA, the Pensions Compensation Board, insolvency practitioners and the official receiver.
§ At the moment a breach of the requirements to provide information to the registrar can result in a criminal sanction. A court can impose a fine up to level 3 on the standard scale, which is a fine of up to £1,000. As a result of the Pensions Act and these regulations, the maximum fine will now be level 5, which is a fine of up to £5,000.
§ OPRA also has the power to impose a medium-level penalty for anyone who uses information from the register for commercial purposes. This carries a maximum civil fine of £1,000 for an individual or £10,000 for a corporate body.
§ There are also minor changes to the items of information which are required for the register, including one completely new piece of information about the nature of benefits that a scheme provides. These regulations have been subject to extensive consultation with practitioners and others who have an interest in these matters. We have addressed their concerns and the comments received. I believe that the regulations provide an effective and sensible way forward and I commend them to the House.502
§ Moved, That the draft regulations laid before the House on 28th January be approved [11th Report from the Joint Committee].—(Lord Mackay of Ardbrecknish.)
§ On Question, Motion agreed to.