Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2006

This order is basically uncontroversial and I can be brief. I say that because I know that the noble Lord, Lord Evans of Temple Guiting, is standing in for my normal opposite number. We can rest assured that by now he will have wilted in the heat of the gardens of Buckingham Palace. I have two questions for the Minister that cover issues that were covered in another place by my honourable friend Mark Hoban, and I trust that my request for further clarification will not prove too onerous for the Minister. My first question relates to the costs of regulation and its impact on competition. The Economic Secretary in another place talked about this order being pro-consumer, pro-competition and benefiting the industry. The Minister said as much this afternoon. These Benches are passionate about the benefits of competition, so we instinctively find this line attractive, but we have an equal passion for minimising regulations and are concerned at the costs involved. I understand from the regulatory impact assessment that the costs for an entrant who is new to regulation will be £100,000 in the first year and £50,000 thereafter. Those are reasonably significant costs that could well deter some forms of new entrant, thus defeating the objective of increasing competition. How many new entrants to the personal pension provision industry do the Government anticipate? In the context of this order, competition can come only from new entrants, because I assume the order will have no impact on existing players in the market. Secondly, I would like clarification about the gap between now and the order coming into effect. The order does not come into effect until 1 April next year when personal pension provision becomes a regulated activity. The Minister will be aware that there has been increasing activity in setting up SIPPs, not just because of A-day, but in the run up to it. Will the Minister explain what level of protection is currently available to people who set up SIPPs? Having set up a SIPP earlier this year, I should know the answer, but I have to confess that I made no inquiries at the time, so it is good that the Minister is here to enlighten me about the level of protection in place for consumers who wish to enter into personal pension arrangements between now and 1 April next.