Pensions Bill

Indeed, my Lords. I always mean it. The amendments concern the investment policy for personal accounts. I will take the two amendments together as they both relate to investment objectives of the Personal Accounts Delivery Authority. Amendment No. 27 would require the Personal Accounts Delivery Authority to develop an investment strategy based on industry best practice, in particular in relation to the delivery authority’s approach to corporate social responsibility. Amendment No. 28 would require the objectives of personal accounts in relation to investment decisions and charges to be set out in the Bill. The December White Paper, Personal accounts: a new way to save, set out a broad overview of the personal accounts scheme objectives, investment expectations and the charging structures. The Government’s response to the White Paper consultation published recently set out our intentions for taking forward the policy on these areas. It is a requirement of European law that pension schemes must comply with the ““prudent person”” rule and that investment decisions must be made in the best interests of members and beneficiaries. The personal accounts scheme will be a trust-based occupational pension scheme, run by trustees who will have a duty to comply with European and domestic legislation to manage the scheme in the best interests of members and beneficiaries. We expect that the Personal Accounts Delivery Authority will consider all manner of industry best practice, investment choices and engagement with stakeholders in developing the investment strategy for the scheme. I hope my noble friend will agree that it is therefore not appropriate to set out specific objectives for the delivery authority to follow as these would constrain its proper consideration of all investment choices. As I have stated on earlier occasions, our proposed Bill, planned for later this year, will set out the finer detail of personal accounts and the remit of the delivery authority. I can reassure noble Lords that we will have the opportunity at that point to discuss in greater detail the proposed plans for investments and charges. In those circumstances, I hope my noble friend will withdraw the amendment.