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Baroness Hollis of Heigham: My Lords, I shall quote the CBI on the matter:
"We also recognise the need for the Regulator to be able to modify their decision if there is a material change in circumstances".
I am saying what the CBI has said. It recognises the point. Everyone in the consultation exercise, apart from the noble Lord in particular—he may have other supporters in the House—agreed that the clearance order must not be binding if there has been a material change in circumstances. That does not stop someone coming forward for a second clearance.
If the job losses are a year or two down the line, the situation would be different from one in which they happen within a month, in which there is an issue of
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bad faith. All those whom we consulted—I have just quoted the CBI—believe that the Government's position is correct. I hope that the noble Lord, Lord Lucas, will not use apocalyptic phrases about sandcastles being washed away with the tide. Clearly, the CBI does not share his view.
Lord Lea of Crondall: My Lords, I trust that I am being helpful in saying this. If, after reading Hansard tomorrow, the noble Lord thinks that there is one outstanding point arising from all the comprehensive responses that my noble friend has given, such a matter could be clarified in correspondence. It would cover the point that the noble Lord thinks that he still has to make. That stage has now been reached, and the noble Lord should reflect on the central remaining point that, he thinks, has not been covered.
Lord Lucas: My Lords, the noble Baroness has brought the discussion to a sensible conclusion. She has said exactly what she means by the clause, and she quoted the CBI at me. I shall take the quotation back to the CBI tomorrow and ask what it means. I think that there is fundamental misunderstanding about the circumstances in which the deals can and should be done. It is possible that the misunderstanding is mine; I accept that.
Before I withdraw the amendment, I shall address the other question that the noble Baroness addressed to me about why we are dealing with these amendments singly rather than all together. It is because we are having a discussion on a fundamental new part of the Bill introduced on Report. If this was Committee stage, we could group everything together. The parts that I did not understand, I could come back on. We could have one discussion which funnelled into a fairly early conclusion.
This Bill has not been produced in a final form; it had to be radically rewritten late. We have had fundamental changes introduced by the Government on Report. The rules of Report necessarily mean that we have a rather stilted debate, which I know that the noble Baroness finds tiresome. So do I. I would much rather have seen this in the Bill when it came to us.
Baroness Hollis of Heigham: My Lords, I have no problem with the noble Lord deciding to handle his amendments in any way that he sees fit. I am saying that most of his amendments so far—we still have another half a dozen to go—come into the same bundle of issues at slightly different angles. It would have been helpful for the House if they had been grouped. We could have considered a block of concerns with an attempt by me to answer those concerns, which could have been pressed if need be. Then we could have moved on.
Lord Lucas: My Lords, I beg leave to withdraw the amendment.
Amendment No. 55, as an amendment to Amendment No. 51, by leave, withdrawn.
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Lord Lucas moved, as an amendment to Amendment No. 51, Amendment No. 56:
"(6) For the purposes of this section an applicant may be a single person, several people acting together, or one or more persons acting on behalf of other persons or classes of persons described in the application."
The noble Lord said: My Lords, I would like to know whether it is the noble Baroness's present intention that this should be possible. I beg to move.
Baroness Hollis of Heigham: My Lords, group applications will be able to be made in a practical way so that not all the information supporting the application will need to be repeated separately by each party. However, an application has to be considered separately for each person. That is because the reasons for clearance are likely to be different in respect of each person and the clearance statements will have to reflect that.
For example, in the case of a corporate takeover, the employer may receive clearance because it would not be reasonable to issue a contribution notice. But the acquiring company may receive clearance because one of the main purposes of the Act is not to avoid pension liabilities.
The noble Lord's amendment would prevent the regulator issuing a clearance notice to each party and giving different reasons for clearance to each, which would make the clearance system unworkable. We know that those most likely to use this system are keen for multiple applications. They will be able to work with us to ensure that the system is practical for them. I hope that the noble Lord feels able to withdraw his amendment.
Lord Lucas: My Lords, I am grateful for that clarification. I beg leave to withdraw the amendment.
Amendment No. 56, as an amendment to Amendment No. 51, by leave withdrawn.
On Question, Amendment No. 51 agreed to.
Clause 43 [Financial support directions]:
Baroness Hollis of Heigham moved Amendment No. 57:
On Question, amendment agreed to.
Baroness Hollis of Heigham moved Amendment No. 58:
"(5) But the Regulator may issue such a direction to a person only if—
(a) the person is at the relevant time a person falling within subsection (5A), and
(b) the Regulator is of the opinion that it is reasonable to impose the requirements of the direction on that person.
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(5A) A person falls within this subsection if the person is—
(a) the employer in relation to the scheme,
(b) an individual who—
(i) is an associate of an individual who is the employer, but
(ii) is not an associate of that individual by reason only of being employed by him, or
(c) a person, other than an individual, who is connected with or an associate of the employer.
(5B) The Regulator, when deciding for the purposes of subsection (5)(b) whether it is reasonable to impose the requirements of a financial support direction on a particular person, must have regard to such matters as the Regulator considers relevant including, where relevant, the following matters—
(a) the relationship which the person has or has had with the employer (including, where the employer is a company within the meaning of subsection (11) of section 435 of the Insolvency Act 1986 (c. 45), whether the person has or has had control of the employer within the meaning of subsection (10) of that section),
(b) in the case of a person falling within subsection (5A)(b) or (c), the value of any benefits received directly or indirectly by that person from the employer,
(c) any connection or involvement which the person has or has had with the scheme,
(d) the financial circumstances of the person, and
(e) such other matters as may be prescribed."
The noble Baroness said: My Lords, I beg to move Amendment No. 58.
Lord Lucas moved, as an amendment to Amendment No. 58, Amendment No. 59:
The noble Lord said: My Lords, when the noble Baroness addressed this amendment in her speech on her mega-group, I am afraid that I did not catch exactly how individuals who fall within Clause 43(5)(a) are being exempted and why it is only employees who are being exempted. It seems to me that someone—an individual—who is associated only by reason of being a shareholder of the company should not be caught either. I beg to move.
Baroness Hollis of Heigham: My Lords, as the noble Lord, Lord Lucas, suspected, we have already discussed that. Individual shareholders are already exempt under the government amendments that we have discussed.
However, corporate shareholders who have control of the company are still within the scope. I am sure that your Lordships will agree that it is right to do so. With that, I hope that I have answered the noble Lord's question.
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