Pensions Dashboards (Prohibition of Indemnification) Bill

Maggie Throup Excerpts

Committee stage
Wednesday 26th October 2022 Public Bill Committees

[The Chair]

Yes. I call Maggie Throup.

[Maggie Throup (Erewash) (Con)]

I congratulate my hon. Friend the Member for Cheadle on successfully navigating this short but important Bill to Committee. I should start by declaring an interest: I am one of the few people in this room likely to benefit from the Bill sooner rather than later. [Laughter.] I know that does not seem likely, but there we are.

This is a simple Bill that strengthens the pensions dashboard regulations. I will focus on clause 1, which I fully support. When the pensions dashboard regulations come into force, the pensions regulator may take enforcement action, which could include a financial penalty, if a trustee or manager of an occupational pension scheme fails to comply with the regulations. When that occurs, there is nothing in legislation to prevent them from reimbursing themselves from the assets of the pension scheme.

The provisions in the Bill will make it a criminal offence for pension scheme trustees or managers to reimburse themselves using the assets of the pension scheme in respect of the penalties imposed under dashboard regulations. It achieves that by amending section 256(1)(b) of the Pensions Act 2004. I am sure that we have all had surgery cases where constituents feel, for a variety of reasons, that they are not getting their expected pension due to inappropriate use of funds. I am sure that this Bill will go a long way to addressing those concerns.

The part of the explanatory notes detailing the impact assessment quite rightly indicates that there may be some indirect benefits of the Bill, as it should help to reassure pension savers that protections are in place to deter unscrupulous trustees or managers, therefore providing greater confidence to save for a pension, protecting our financial futures. In conclusion, I am sure that my Erewash residents will welcome the measures in the Bill, so I am delighted to support clauses 1 and 2 as they stand.

[Richard Graham]

As a trustee of the parliamentary pension scheme, I should declare a relevant interest. Today is a great moment to congratulate two colleagues. The work on creating the pensions dashboard was done by my hon. Friend the Member for Hexham. I think we all recognise what a great job he did on that as Parliament’s longest-serving pensions Minister. It is also right that we all congratulate my hon. Friend the Member for Cheadle, who has taken this forward, building on the work done by my hon. Friend the Member for Hexham, to create surely one of the shortest and least contentious Bills that this House has ever had to deal with. I am sure that the Minister will say something similar in due course.

Ensuring that trustees and managers do not effectively raid a pension fund, other people’s assets, effectively, to deal with their own errors—advertent or inadvertent; as my hon. Friend the Member for Cheadle said, most instances will be inadvertent—is absolutely right and proper. This just sensibly fills a gap. The business of insurance indemnification for trustees against inadvertent mistakes will also be reassuring to those who volunteer as trustees almost always completely free of charge. On that basis, there is a huge amount to appreciate and support in this short Bill.