Pensions Bill, 1990: Committee Stage (Resumed).
Debate resumed on amendment No. 11:
In page 11, subsection (1), lines 18 to 20, to delete paragraph (c) and substitute the following:
"(c) to draw up and issue codes of practice in relation to which the following shall apply—
(i) the Board may, as it thinks fit, approve of any code of practice or any part of any code of practice drawn up by any other body,
(ii) codes of practice issued or approved of under this section shall be for the purpose of providing practical guidance with respect to the requirements or prohibitions of any of the relevant statutory provisions,
(iii) the Board shall obtain the consent of the Minister before issuing or approving of a code of practice,
(iv) the Board shall, before seeking the consent of the Minister for the issue or approval of a code of practice, consult any Minister of the Government or other person or body that appears to the board to be appropriate or where the Minister so directs,
(v) where the Board issues or approves of a code of practice it shall publish a statement inIris Oifigiúil of its issue or approval of that code, identifying the code in question, specifying for which provisions of the relevant statutory provisions the code is issued or approved and the date from which the said code shall have effect,
(vi) the Board may, with the consent of the Minister and following consultation with any other Minister of the Government or any other person or body that appears to the Board to be appropriate—
(I) revise the whole or part of any code of practice prepared by it,
(II) withdraw its approval for any code of practice or part of any code of practice,
(vii) where the Board revises, withdraws or ceases to approve of a code of practice it shall publish notice to that effect inIris Oifigiúil,
(viii) a failure on the part of any person to observe any provision of a code of practice shall not of itself render him liable to any civil or criminal proceedings, but where in any criminal proceedings a party is alleged to have committed an offence by reason of a contravention of any requirement or prohibition imposed by or under any of the relevant statutory provisions being a provision for which there was a code of practice at the time of the alleged contravention, subparagraph (ix) shall have effect with respect to that code in relation to those proceedings,
(ix) any provision of the code of practice which appears to the court to give practical guidance as to the observance of the requirement or prohibition alleged to have been contravened shall be admissible in evidence, and if it is proved that any act or omission of the defendant alleged to constitute the contravention is a failure to observe such provision of the code, or if it is proved that any act or omission of the defendant is a compliance with such provision of the code, then such failure or compliance shall be admissible in evidence.".
—(Deputy Ferris.)
We were talking yesterday about codes of practice. While we welcome the functions of the board as proposed in this section, I would not be surprised if the Minister did not agree to our amendments which seek to delete the reference to codes of practice in section 10 (1) (c) and replace it with a new section and my fear in this regard is shared by the Irish Congress of Trade Unions. In other legislation, there is a statutory basis for codes of practices and minimum standards are set down. Section 10 (1) (c), as worded is inadequate. It is desirable that there is a consistent legal basis under legislation for codes of practice. For example, the most recent legislation dealing with codes of practice is the Safety, Health and Welfare at Work Act, 1989. The two sections in that Act which deal with this issue are sections 30 and 31, which contain detailed provisions on codes of practice. It is essential that we amend this section. Otherwise the codes of practice issued by the new board could have little or no impact on the unsatisfactory position that exists under the Trustee Acts of 1888, 1893 and 1958. The Minister admitted in his introduction to the Bill that these Acts were not passed with pension schemes in mind.
If the Bill is passed as it is worded at present, there could be disturbing cases such as that of the H. Williams workers who had to use costly and lengthy court procedures to remove trustees. The situation which prevailed in that case should never recur in the future. A number of workers there had to go to incredible lengths, bringing the case to the High Court where a formula was arrived at to replace trustees of the pension fund. It is interesting that some of the so-called trustees did not seem to know they were trustees of the fund.
It would not be sufficient to say that the board would set down the guidelines for the codes of practice. They should be built into the legislation, which would bring the procedure into line with other codes of practice legislation such as the example I gave heretofore. I ask the Minister to take on board amendments Nos. 12, 14 and 15. I wish to emphasise the importance of laying down a statutory basis for codes of practice which will be drawn up by the new board, to ensure that they have a real impact. Otherwise, pension fund members would be no better off after the Bill is enacted than they have been heretofore. Our amendment states that failure to observe the provisions of a code of practice issued by the board or compliance with such a code will be admissible in evidence. I take the same view as Congress in that this matter is important and hence I would ask for the support of amendments Nos. 12, 14 and 15 in my name.
I am glad the Deputy mentioned that. I would just remind the House that we are dealing with amendments Nos. 11, 12, 13, 14 and 15 together.
Obviously we are all aiming at the same objective. It was the Congress submission in particular that drew our attention to the problems regarding codes of practice in the past. There have been problems down the line with the legal status of codes of practice and that matter should be more clearly specified in the legislation. We in Fine Gael have adopted a different approach. The functions of the board and their capacity to operate effectively will be one of the central elements in the Bill and the success of the Bill will depend on it. Of that list of functions, none is more central than the rules and guidelines the board will issue to trustees. The legal cases and the problems that have arisen in the past have been due to a total lack of clarity in that regard. This Bill supersedes the trustee legislation and will govern pensions from now on. It would be unsatisfactory to leave the issuing of guidelines and codes of practice entirely to the board. They should be laid down specifically in the Bill.
While I have sympathy with certain parts of the amendments proposed by my two colleagues in the Opposition parties, I suggest that some of their proposals are unduly cumbersome and would involve great delays in processing codes of practice. We have established a board and we should rely on them to make certain decisions but it is important to specify, in the terms laid down in my amendment, the broad areas they would cover.
I referred yesterday to the case of a person who is a member trustee. While this Bill, certainly in later sections, specifies particular duties for trustees, it does not say that in order to carry out those duties a person must be appointed in a certain way. The whole area of appointment, apart from the later references to member trustees, is completely vague and will be left entirely to the board when setting down their codes of practice. The trustees are essential to the success of the Bill. A person reading this Bill would have no clear idea of the Dáil's thinking in relation to the way in which trustees should be appointed and should carry out their functions, other than the broad duties referred to in later sections. This is inadequate unless it is specified that codes of practice lay down minimum standards regarding the appointment and election of trustees. Under the existing law there are many good schemes and many have very detailed deeds and rules.
I have a British one here — The Merchant Navy Officers Pension Fund — that affects people in Ireland. It was sent to me by somebody who had read the Bill and who was concerned that there was nothing in it about the appointment of trustees and management committees. The current practice in many cases is that there is a management committee representing workers and employers who decide on the method and number of trustees and who go about appointing them. An arrangement is made for regular committee meetings and everybody knows what is going on. I imagine the board will do this but it would be desirable — to use a phrase that is used in other lobbying on this Bill — to have it fairly transparent because it is a central element of the Bill. The minimum we should require of the board in the appointment and election of trustees is that any member of any scheme should know they have a right to that kind of information; its availability is something that is required by law of anybody involved in a pension scheme. In amendment No. 13 in my name "committees, management" should read "committees of management" but it amounts to the same thing and perhaps the Minister would accept that correction. The frequency of meetings is a major issue. Standards can be set but it is possible to have only an annual meeting which would be totally unsatisfactory in relation to ensuring that anybody who was a trustee was in a position to perform their functions because it would require waiting until the year was ended. If there is not a statutory requirement to meet more regularly, would it be valid, for instance, to complain to the board that the scheme was not being managed properly by reason of there not being more regular meetings? It is important that that issue and the nature and content of information be clarified.
Trustees must be given the tools by which they can perform their function adequately. The Bill would be more effective if this amendment were adopted. I would be very interested in hearing what the Minister has to say. He must have received substantial representations in relation to this section. He must be aware of the problems that have arisen in other legislation. He has not submitted any amendment in this area.
We should clarify what exactly we are trying to achieve in these amendments and what I have been trying to achieve on behalf of the Labour Party by means of amendment No. 11. Section 10 (1) (c) as presented proposes a requirement on the board to issue guidelines on the duties and responsibilities of trustees of schemes and codes of practice on specific aspects of their responsibility. That is a welcome provision but we are setting up a board which we hope will be autonomous to a large extent. However, we do not want them to be so autonomous that, unless we put in a strengthening provision, such as I have suggested in amendment No. 11, the Minister will not be answerable to the House in respect of any code of practice that may be laid down by the board. That does not mean I do not have faith in the board but I want the Oireachtas to have access to consultation. To clarify the requirement in relation to the Oireachtas I am suggesting that the Minister should be responsible. In my amendment I have specifically said that if the board want to do anything they will do it in accordance with the Minister's approval, in consultation with him and with his consent, which is not bureaucratic but it would be normal procedure that a statutory board, if they are laying down codes of practice, would at least have regard to what Government consider is the appropriate code of practice. I am also suggesting a procedure to be followed in the event of their wishing to change a code of practice where they would be obliged to publish their proposal in official documentation which would also be available to the Oireachtas. We would then have an opportunity of putting down a question, if necessary, to a Minister to ascertain if he was satisfied with a particular aspect of the code of practice. If we do not have that requirement it means that apart from requiring the board to set up a code of practice, the code of practice would not have statutory foundation and this would make the legislation deficient. That is the reason congress had suggested using a system of advice in relation to a code of practice in law in the previous legislation which was enacted in 1989.
If the Minister examines each of the subsections I have suggested in my amendment, he will see that they are exact replicas of the previous legislation on the welfare and safety at work legislation where the Minister put in a requirement regarding the code of practice. There is nothing bureaucratic about this requirement, there is nothing obstructionist about it, but it allows the Oireachtas to have access to any changes that the pensions board may lay down.
The final requirement of my amendment is also vital in that non-compliance with this requirement would be admissible in evidence. If there was to be a case we have already agreed that failure to comply with the law is a serious offence, and yesterday evening we increased the penalties. The final subsection of my amendment seeks to ensure that failure to comply with the regulations shall be admissible in evidence. This should at all times be in the jurisdiction of the Minister and by extension of that democracy is accessible to us in the Oireachtas by way of parliamentary question or otherwise or, indeed, by direct representations because the Minister will have a statutory obligation in this respect to the House. Whereas if we allow the codes of practice to remain within the jurisdiction of the pensions board it will be outside the Minister's competence to be answerable to this House in regard to them.
I am aware that this board are not yet sure what their proper and full role will be. Perhaps they would not want to be restricted too much as regards the codes of practice they may lay down. The least they should have is the advice of the House and suggestions from this side of the House. They should have the courtesy and the obligation to consult with the Minister if they want to introduce codes of practice of which we are unaware. I am anxious that the provisions in this Bill will protect the rights of people who are beneficiaries under pension benefits. That is my only concern. For that reason I submitted amendment No. 11 in that format on the basis that the same Government, but a different Minister, have accepted this code of practice. After the discussions I had with congress, they agreed that this is the appropriate way to deal with the matter. If the legal binding being sought is not given, congress is of the opinion that any other code of practice that would be issued by the board would have little or no impact on current practice. They are suggesting it should be dealt with in this way. The other two Deputies have approached the same problem in a slightly different way but the end result would be the same. My amendment is the first one and I am putting it on the basis that it is the correct one.
The main difference between this legislation and the other legislation referred to by the Deputies is that under this Bill the Minister will have very extensive powers, particularly by way of regulation. If we are not happy with the position the Minister may make regulations. One of the functions of the board, as laid down in section 10 (1) (c), is to provide clear guidance to trustees in the exercise of their duties and responsibilities where and as necessary. The board have said that there is a need for this flexibility.
Deputies fear a situation which may arise but I do not believe it will. It has not arisen to date. Great progress has been made and I am quite certain that the incoming board will make further progress which would be to everybody's satisfaction. Nonetheless, if we are not happy about the position, the Minister may be challenged in the House and regulations introduced, but we do not want to go about the matter that way. The way we want to go about it is for the board to issue guidelines to the trustees on the way schemes should be run. There are a great variety of schemes and I am quite certain that the one cited by Deputy Flaherty would not be suitable in many other cases. There are 25,000 voluntary schemes upon which agreement has been reached between the members, the trustees and those supplying the scheme. We do not want to tie them down too much.
The Bill which runs to 56 pages, contains 79 sections and three Schedules, provides for a comprehensive regulation of occupational pension schemes. Provision is also made for the introduction of detailed regulations which will prescribe how effect is to be given to the main provisions of the Bill. The board is then charged, in accordance with section 10 (1) (c), with giving guidance to trustees as to how they should discharge their duties and responsibilities in the light of these detailed legal requirements.
I envisage the board, in consultation with all the various interests involved with occupational pension schemes, will draw up guidelines and codes of practice which will clearly lay down what best practice should be in relation to the various areas to which these guidelines and codes of practice refer. These however can only serve as a guide covering the majority of cases to which they apply. Exceptional cases will arise constantly for which the general guidance provided would not be appropriate and which may not even have been envisaged by the board when the guidelines or codes were being drawn up. The advice I have received from organisations representing those who administer pension schemes is that it would not be possible for the board to draw up guidelines and codes of practice that would cover every possible case, especially in the initial stages before experience is gained in implementing the legislation. To attempt to do so would result in the guidelines and codes of practice becoming exceptionally long and complicated and in need of almost constant revision.
If the type of statutory provisions proposed in the amendments in relation to codes of practice were made the whole purpose and nature of the board's function in this area would be changed. The codes of practice instead of being drawn up as guidelines in clear, easy to understand language and designed to cover normal cases in the areas to which they apply would have to be drawn up instead as quasi-legal instruments. They would not then simply be offering guidance but laying down rules which trustees might consider they had to comply with irrespective of the appropriateness of such rules in relation to cases which would be of an exceptional nature. Given that there are 25,000 occupational pension schemes there will be many such exceptional cases.
I have stated from the outset that I want to avoid over-regulation that could jeopardise the future development of occupational pension schemes. The amendments proposed in relation to the issuing of codes of practice would lead to such over-regulation as the board could in effect end up having to lay down quasi-legal rules designed to cover every eventuality in the areas to which the codes of practice would apply. In this context Deputy Ferris referred to the Safety, Health and Welfare at Work Act. Codes of practice which have a statutory basis are necessary for the type of situations covered by that Act as, unlike the case of pensions, there are no detailed legislative requirements in this area. Accordingly, codes of practice have to be relied on to flesh out the basic rules laid down in the Act. That brings me back to the initial point I made that extensive powers and controls are being provided under the Bill which may be implemented when necessary.
A more relevant situation is that governed by the Insurance Act, 1989. Sections 56 and 61 of that Act provide that the Minister may by order prescribe codes of conduct. I understand, however, that it has been decided to opt for voluntary codes in this regard because of the difficulties which would arise if such a code was given a statutory basis. I am satisfied that the provisions of this Bill and the detailed regulations to be made thereunder will provide adequate legal safeguards for the pension rights of members of occupational pension schemes. Section 58 of the Bill sets down clearly what the duties and responsibilities of trustees are in relation to the administration of pension schemes. There is also a considerable case law in relation to the application of the Trustee Acts. What is required in addition is guidance from the board as to how trustees can best exercise their duties and responsibilities in the light of these comprehensive and detailed legal requirements. I am satisfied that section 10 (1) (c) provides an adequate basis for such guidance to be given.
Deputy Flaherty has proposed an amendment which would involve the addition of two subsections to section 10. I do not consider the proposed subsection (3) is necessary. Amendment No. 56 which I am proposing and which we have already discussed provides for the selection by members of funded schemes of persons for appointment as trustees. I am satisfied that it would provide an adequate statutory basis for member participation in the election of trustees which is the main concern in this regard. I have already explained the reasons in some detail.
Codes of practice in relation to the other matters referred to in the proposed subsection (3) can be issued by the board in accordance with section 10 (1) (c), if considered appropriate. The extent to which codes of practice should be laid down in relation to these matters and the form they should take are best left to the new board.
Deputy Flaherty has also proposed a new subsection (4) which provides that codes of practice be admissible as evidence. It will be possible for reference to be made to codes of practice issued by the board, where relevant, in cases before the court where the exercise by trustees of their duties and responsibilities is at issue. I was also concerned about this aspect of the matter and was thinking of introducing an amendment but I have been assured that this is unnecessary. To specifically provide for this in the Bill, as proposed by the Deputy, would confer a status on such codes which would result in their being treated as quasi-legal instruments. I have already spelled out the reasons why I consider that this would be undesirable and I am opposed to the amendment proposed by Deputy Flaherty for the same reasons.
I appreciate the concerns of the Deputies in raising these points but I would like to assure them that adequate provision is made under the Bill for dealing with any difficulties which may arise in this regard. Essentially, what I want to do is to provide the board with the power to proceed to issue guidelines and codes of practice. I will ask the board to bear the views of the Deputies on this matter in mind.
I will not dwell on this matter too long as it is clear that each of us is deciding on what we are ultimately going to do. I would like to address some of the questions raised by the Minister. He has asked us to give the board a chance and let them recommend codes of practice for trustees and indicate what their responsibilities should be. He also argued that given the fact that there are 25,000 voluntary schemes in operation we should not be too hard on them and should not be too concerned about putting the matter on a proper legislative footing. I would disagree fundamentally with the Minister.
I am saying there is more than an adequate legislative footing. There are far more powers in this than in any of the Health Acts.
The Minister claims he can amend by regulation. Many regulations will have to be made as a result of the complex nature of this Bill. The Minister claims he can police matters by regulation but that is not satisfactory. We must give the codes of practice a firm statutory basis. If something serious goes wrong it will be too late for the Minister to discover that he will have to issue a regulation to go over ground lost.
The key elements of the Bill are the functions of the board and the functions and role of the trustees. We are looking for a relatively minor alteration to section 10 because of our collective fears that regulations in themselves will not be sufficient and that codes of practice established by the board will not have a sufficient legal basis. The Minister seems to suggest that our recommendation would lead to the over-regulating of the system by providing rules rather than guidelines. I reject the argument that we are asking for over-regulation but because of the nature of the 25,000 schemes we need good law underpinning the codes of practice to be established by the board.
The Minister's reply is interesting but I still have many reservations.He indicates that he has made a decision in principle to leave these guidelines loose and does not feel it necessary for them to have a legal standing. The view on this side of the House is that they should have a legal standing. The Minister argues that powers eleswhere in the Bill sufficiently protect members and that it is not necessary to tie up the guidelines in this way. This indicates the need for one of the other amendments I have proposed regarding the need to have a member of the legal profession on the board. Much of the board's activity will be legal or quasi-legal and the board will benefit from legal expertise.
The Minister refers to sufficient protection elsewhere in the Bill in section 58. He also refers to the power to have member trustees, suggesting that this would be a protection. However, the provision for member trustees is open-ended, with no clear date of implementation.The Minister is simply taking power under the Bill, with the hope that it will happen. My amendment on this matter was ruled out of order last night because we had already begun debate on that area. My concerns were justified but we can come to it on Report Stage.
I draw the attention of the Minister to the experience of a pension fund where there was a member trustee appointed by the members who had been given absolutely no information about the scheme. The group of trustees had never met since its appointment. There was reference to the H. Williams case where they did not even know they were trustees. Giving responsibilities to trustees tightens up matters because they have to perform certain functions. They must ensure that contributions are received and properly invested and that arrangements for payments are properly made. They must also ensure that proper membership and financial records are kept. There are other duties regarding registering and disclosure of information. I suppose it would be extremely hard to fulfil these functions without meeting regularly. If the administration of these functions is handed over to an insurance fund there is no clear indication of what would happen with the trustees. Who could argue in a court case if the trustees meet once a year or once every three years that they are adequately monitoring a scheme? We should have codes of practice which would require at a minimum quarterly meetings of trustees. What standards will the board have if their guidelines and codes of practice in relation to the way trustees perform their functions are not legal documents? We would have to see how courts would react.
The argument that other sections of the Bill give adequate protection is doubtful. The position of trustees will be unclear since the guidelines will not be legal guidelines. What trustees are asked to do to indicate that they are performing their function is still unclear. There could be member trustees and a reasonably operated scheme but without the level of communication we would hope for. Perhaps the Minister would say why he feels the Insurance Acts are a more appropriate model. The ICTU made a strong case that codes of practice are becoming a feature of much legislation and that consistency is desirable. I have pointed out some problems that could arise if these matters are not more clearly specified. Congress has said it is essential that there should be clarification, otherwise the board's codes of practice will have little or no impact on current practice. Congress feel that the second part of the amendment regarding the failure to observe the provisions of the code of practice is necessary, to be consistent with other legislation.
The Minister has not reassured us that his approach is the proper one and that the approaches we are suggesting would not be more effective, while not being too limiting or demanding on the board. In issuing codes of practice it would be desirable to expect that they would be implemented. The board members will have a very deep level of expertise in relation to the management of schemes, with the association of the representatives of the pension funds and of the industry. It should be within their remit to set minimum standards and say whether there will be quarterly meetings of trustees; and they should be able to make arrangements regarding a general meeting of workers and management to discuss the issue. Some of these very basic matters would not be unduly expensive, cumbersome or demanding on any scheme, apart from circulating a letter to members making a commitment to set aside a board meeting and maybe providing a meal for the trustees. The Minister has not convinced me that his approach is better than that suggested from this side of the House.
Let us be clear about the difference between the Safety, Health and Welfare at Work Act, 1989 and this Bill. We are providing all the powers here. In Part V, sections 53 and 54, we are spelling out in law duties and responsibilities.They are all in the Bill with full legislative power. In the same way the trustees and their duties are spelled out clearly in sections 58, 59 and 60. We are providing much more comprehensive legislative grounding for what is being done. Deputies are trying to get me to go further and to put all these operational matters into very tight, legalistic provisions.A board will have to work these out in the first instance and see what guidelines are necessary or desirable. If we do not accept that, then let us say so and we will vote on it.
Deputy Byrne keeps saying he does not like the idea of doing so many things by regulations. That is fundamental to the Bill and every technical specialist who knows anything about the matter says this is the best way to handle this. If Deputies do not agree, let us have it out, disagree, and say we will vote on it, and let them vote against it.
This Bill is an enormous piece of legislation with vast new provisions in law for a voluntary sector. Some of our EC partners will not do this and we are trying to convince them that it should be done. I know the best way to go about it is to provide the basic legislation and then provide the regulations which will have the flexibility to implement it. If Deputies do not agree that that is the best way to go about it, then we will have a difference of opinion and that will be the end of it. There is no point going on and on about this regulation. That is fundamental to the Bill and we are approaching it in that way.
Deputy Byrne says the scheme could collapse. That cannot happen. That is covered in the legislation. We are talking about codes of practice which are very generalised but are within this legislation. Do not broaden it into something it is not. All the powers and the safeguards are provided here and spelled out very clearly. Throughout the whole country they are recognised as excellent. It is a huge step forward and we need not worry about all this detail. Can we not trust a board? Normally I am told that I should give the board powers and not have the Minister taking all the power. I am giving the board powers and saying they have the freedom and legislative base to get on with the job.
I understood Deputy Ferris' concern and note that these were the kinds of things he wanted the board to bear in mind. I have said I will convey his views to the board, although I know the board will look at the debates in the House and consider them. We can go on discussing this forever. This morning we wasted an hour going around in circles. The sooner we get this legislation into practice the better. It is excellent legislation, very broadly based with enormous new powers.
It would be better were the amendment accepted. We would not have spent an hour——
Go ahead and vote on it. I do not want to talk any more about it.
It is time to reach a decision and move to fresh pastures.
The Minister is suggesting that possibly the way forward is to call a vote. Probably I will because maybe that is the appropriate thing to do. There is little difference between what the Minister is saying and what we are saying. Section 10 (1) (c) provides that the board shall issue guidelines on duties. I have suggested nothing different in my amendment.My amendment provides that they "draw up and issue codes of practice in relation to which the following shall apply". I do not say what is to be in the codes of practice. The board may, as they think fit, approve of any code of practice or part of a code of practice drawn up by another body. I am not tying up the board unduly. I am saying any code of practice they issue under that section shall provide practical guidance with respect to the requirements or prohibitions of any of the relevant statutory provisions. There is nothing wrong with that. It is already in law anyway.
My amendment provides that "the board shall obtain the consent of the Minister before issuing or approving a code of practice,". If any Minister tells me the Bill is strong enough to ensure the implementation of the codes of practice, the Department and the Minister will have to patrol the legislation and the codes of practice to make sure they are in accordance with what he wants. My suggestion would oblige the board at least to consult and to get the Minister's approval, and when they get it, if they want to change those codes of practice because in practice, they may be found impracticable, then they would need only the consent of the Minister. I see nothing wrong with legislating in that way.
I have not suggested what they should put into the codes of practice, I am suggesting that, when they come up with a scheme on the codes of practice, they will seek the approval of the Minister. That is the end of the story. If I or my colleagues discover that, even if the Minister approves of codes of practice, they are not in keeping with what we feel they should be, then we can bring the Minister back here by a parliamentary question or otherwise. It is a very simple procedure.
The amendment may sound cumbersome because it is a repetition of a section from another Bill, but at least the board will have to consult and get the Minister's approval. Any Minister should need that power, and we want him to have it because once he has it, we will have access to it. If he has to bring in other regulations to change a code of practice, then we are getting nowhere. If we do not strengthen section 10 (1) (c) the codes of practice will have no statutory basis, no basis in law, and nobody will be able to do anything about a group of trustees or a board if their regulations or sets of guidelines are not in accordance with what is laid down here. In other words, I am seeking the approval of the Minister to any code of practice set down by the board for their trustees. I thought we could reach agreement on this amendment but as we have not I will have to press it to a vote. I hope that regardless of the outcome of the vote the incoming new board will know the views of this House on this point.
The Minister said that he could make regulations but I do not think there is any provision for the making of regulations under section 10. As I read it, we will have to depend on the board to set down guidelines on the duties and codes of practice for the trustees. The Minister said he believes that under other sections sufficient demands will be made on trustees in meeting the provisions of preservation, disclosure, etc., and ensuring that people are adequately protected. I made a very specific point about where this will not be the case. In any debate on this issue all that will matter is whether there is a problem with any member and because there will be no standards in relation to how often they should meet and the kind of information they are given it will not be possible to prove that they are not carrying out their functions properly. As I said, trustees may meet only once every three years and still be complying with the other provisions of the Bill. I do not think this would be desirable and it is necessary to have some standards in this area.
I am not saying the Minister should be involved on a daily or weekly basis — this would tie up the board — but we should indicate that we expect the board to set down guidelines for the trustees on how often they should meet and the information they should have. I know from experience that this can be a problem for a minority of pension funds — obviously the majority of schemes comply with the guidelines and manage their affairs properly — and it is necessary to set down guidelines on how often trustees should meet, how committees of management are established and the information they should have. I do not think that would be an undue burden on anybody. I cannot envisage any code of practice which would not provide for these matters. There are other codes of practice which need not be regulated for but we should set out in the Bill how the board of trustees should carry out their functions.
The Minister has clearly decided he does not want to give the trustees a legal standing. He said that everybody in the country is happy with this but this is clearly not true. Congress has lobbied us quite heavily about——
The approach of using the regulations is what I was talking about.
——their concerns in this area. I share their concern because the behaviour of the trustees is important if they are to become adequately involved.
The Chair is satisfied that every worthwhile point on this amendment has been exhausted.
The Minister is exhausted.
I should like to clarify one point. The regulations relating to disclosure——
They do not relate to the functions of trustees.
They are covered in two ways; first by section 10 (1) (g) which provides that the Minister can ask the board to perform such tasks as he may request from time to time — that is very open and I think it deals with the point raised by Deputy Ferris — and secondly, by section 10 (1) (c) which requires the board to issue guidelines on the duties and responsibilities of trustees of schemes and codes of practice on specific aspects of their responsibilities.
Where will they go from there? That is the problem.
The question is: "That the words proposed to be deleted stand."
Question put.
The Committee divided: Tá, 76; Níl, 69.
Tá
- Ahern, Bertie.
- Ahern, Dermot.
- Ahern, Michael.
- Andrews, David.
- Aylward, Liam.
- Barrett, Michael.
- Brady, Gerard.
- Brady, Vincent.
- Brennan, Mattie.
- Briscoe, Ben.
- Browne, John (Wexford).
- Burke, Raphael P.
- Calleary, Seán.
- Callely, Ivor.
- Clohessy, Peadar.
- Collins, Gerard.
- Connolly, Ger.
- Coughlan, Mary Theresa.
- Cowen, Brian.
- Cullimore, Séamus.
- Daly, Brendan.
- Davern, Noel.
- Dempsey, Noel.
- Leonard, Jimmy.
- Lyons, Denis.
- Martin, Micheál.
- McCreevy, Charlie.
- McDaid, Jim.
- McEllistrim, Tom.
- Molloy, Robert.
- Morley, P.J.
- Nolan, M. J.
- Noonan, Michael J.
- (Limerick West).
- O'Connell, John.
- O'Dea, Willie.
- O'Donoghue, John.
- O'Hanlon, Rory.
- Dennehy, John.
- de Valera, Síle.
- Ellis, John.
- Fahey, Jackie.
- Fitzgerald, Liam Joseph.
- Fitzpatrick, Dermot.
- Flood, Chris.
- Flynn, Pádraig.
- Gallagher, Pat the Cope.
- Geoghegan-Quinn, Máire.
- Harney, Mary.
- Haughey, Charles J.
- Hillery, Brian.
- Hilliard, Colm.
- Hyland, Liam.
- Jacob, Joe.
- Kelly, Laurence.
- Kenneally, Brendan.
- Kirk, Séamus.
- Kitt, Michael P.
- Kitt, Tom.
- Lawlor, Liam.
- Lenihan, Brian.
- O'Keeffe, Ned.
- O'Kennedy, Michael.
- O'Leary, John.
- O'Toole, Martin Joe.
- Power, Seán.
- Quill, Máirín.
- Reynolds, Albert.
- Roche, Dick.
- Smith, Michael.
- Stafford, John.
- Tunney, Jim.
- Wallace, Dan.
- Wallace, Mary.
- Walsh, Joe.
- Woods, Michael.
- Wyse, Pearse.
Níl
- Ahearn, Therese.
- Barnes, Monica.
- Barrett, Seán.
- Barry, Peter.
- Bell, Michael.
- Belton, Louis J.
- Boylan, Andrew.
- Bradford, Paul.
- Browne, John (Carlow-Kilkenny).
- Bruton, John.
- Bruton, Richard.
- Byrne, Eric.
- Carey, Donal.
- Connaughton, Paul.
- Connor, John.
- Cotter, Bill.
- Creed, Michael.
- Crowley, Frank.
- Currie, Austin.
- D'Arcy, Michael.
- Deasy, Austin.
- Deenihan, Jimmy.
- De Rossa, Proinsias.
- Dukes, Alan.
- Durkan, Bernard.
- Enright, Thomas W.
- Farrelly, John V.
- Fennell, Nuala.
- Ferris, Michael.
- Finucane, Michael.
- Flaherty, Mary.
- Flanagan, Charles.
- Garland, Roger.
- Gilmore, Eamon.
- Gregory, Tony.
- Harte, Paddy.
- Higgins, Jim.
- Higgins, Michael D.
- Hogan, Philip.
- Howlin, Brendan.
- Kavanagh, Liam.
- Kemmy, Jim.
- Kenny, Enda.
- Lowry, Michael.
- McCartan, Pat.
- McCormack, Pádraic.
- McGahon, Brendan.
- McGinley, Dinny.
- Mac Giolla, Tomás.
- McGrath, Paul.
- Mitchell, Jim.
- Moynihan, Michael.
- Nealon, Ted.
- Noonan, Michael.
- (Limerick East).
- O'Keeffe, Jim.
- O'Shea, Brian.
- O'Sullivan, Gerry.
- O'Sullivan, Toddy.
- Quinn, Ruairí.
- Rabbitte, Pat.
- Ryan, Seán.
- Sheehan, Patrick J.
- Sherlock, Joe.
- Spring, Dick.
- Stagg, Emmet.
- Taylor, Mervyn.
- Taylor-Quinn, Madeleine.
- Timmins, Godfrey.
- Yates, Ivan.
Tellers: Tá, Deputies V. Brady and Clohessy; Níl, Deputies Howlin and McCartan.
Question declared carried.
Amendment declared lost.
Amendment No. 12 not moved.
I move amendment No. 13:
In page 11, between lines 30 and 31, to insert the following subsections:
"(3) Codes of practice regarding trustees shall lay down minimum standards regarding the appointment or election of trustees, committees, management, frequency of meetings, and the nature and content of information which they are to be supplied with.
(4) In any proceedings under the provisions of this Act, failure to comply with codes of practice shall be admissible in evidence.".
I will not press this amendment to a vote but I should like to record my concern regarding codes of practice. In schemes that have run into difficulties the experience has been that the function and operation of trustees have caused the greatest problem. It would be a fundamental flaw in this Bill if we leave that area confused and dependent on guidelines which will not have legal standing. For members of schemes to be able to operate them properly and to adequately protect themselves it is important that the operational standards expected of trustees should be set down and have legal standing, which is the case elsewhere in the Bill relating to demands made on schemes and funding disclosures.
We agreed to discuss amendments Nos. 11, 12, 13, 14 and 15 together.
We will not be pressing this to a vote as we have already had a vote on the substantive issue.
Amendment put and declared lost.
Question proposed: "That section 10 stand part of the Bill."
I wish to record my dissent because paragraph (c) is too weak.
I should also like to record my unhappiness at the Minister's refusal to accept our amendment to this section.
I support the previous speakers in relation to the weakness of the subsection dealing with the general responsibility of trustees. I had practical experience in this area in a recent case. A company was bought by someone in Britain and they also bought the pension fund. The new owner appointed himself and his financial controller as trustees of the scheme. Within two years of buying the company they wound up the pension fund and left the unfortunate employees without the pension they expected to get on reaching the age of 62 or 65, depending on the years of service. It is extraordinary that trustees, who are supposed to act in the best interests of the members of the scheme, are not——
That is a different section.
No, this section refers to the duties, role and responsibilities of trustees of a scheme. The responsibilities of trustees of a pension fund are primarily to the members of the fund.
I should like to explain to the Deputy that a whole section is devoted to the functions and responsibilities of trustees, which covers the matter. There is not an inadequacy in relation to the powers and functions of trustees. This section just relates to the functions of the board.
We are talking about the board's guidelines to trustees and I am arguing along the lines of other speakers.Anybody dealing with trustees of a pension fund should have some statutory control over their activities. If a man or woman works for 35 or 40 years in a company which is subsequently bought by someone who winds up the pension fund, with the result that its profits go to the coffers of the company, it is morally wrong and legislators must ensure that it is not allowed to happen. I am aware that up to now there was no legislation governing the activities of trustees but in this section we are talking about the functions of the board, which are to issue guidelines on the duties and responsibilities of trustees of pension funds. I am availing of this opportunity to point out the practical difficulties.
Another Member of the House told me of a similar situation in which he was involved with a company which he sold. The new purchaser promptly wound up the pension fund. This is sharp practice and has nothing to do with good business; running a company that way typifies bad management. I will also speak on the next section dealing with the responsibilities of trustees and I will speak on every opportunity I get to point out this practice should not be tolerated. We are talking about people who give many years of their lives to a company and who look forward to getting a proper pension in their old age, to which they are entitled. Sharp practice of any kind, particularly on the part of so-called trustees, should not be allowed I ask the Minister to make certain that he uses this legislation to prevent this kind of thing in the future.
The functions outlined in subsection (1) are similar to those recommended in the first report of the National Pensions Board. The board will have a supervisory and advisory function and their main function will be to monitor and supervise the implementation of the new requirements by occupational pension scheme. This section adequately provides for the functions of the board in a very consistent way with the report of the National Pensions Board.
In relation to section 10, apart from the reservation with the amendment expressed by my colleague, Deputy Seán Barrett, I refer also to the functions of the board in section 10 (1) (d) which reads: "to encourage the provision of appropriate training facilities for trustees of schemes;". That will be vitally important, particularly in the case of member trustees, if the provisions of the Bill are to really protect them. It will remain possible for persons handling schemes, for employers who may have a desire to engage in subterfuge of one kind of another, to run rings around people. It is a very specialised, expert area. Those who have been endeavouring to come to grips with it in unions will freely admit that it is an area requiring great expertise. The issue of education is vital.
If the Minister considers an additional amendment I request that it would not simply include trustees of schemes but that the board should be requested to engage in some general educational function for members of schemes also, perhaps running annual seminars. A requirement of this kind might be asked of the board because trustees may not even be a member of the scheme. If members are to be adequately protected the information they receive will not be of great value to them unless there is a degree of education associated therewith.Those of us who have tried to come to terms with the provisions of this Bill know just how technical is the whole area and no doubt the Minister after a couple of years of close relationship with the overall issue also realises this and that if members are to be adequately protected they will require much information. I know the unions are engaging in that educational process to a degree but, in the case of people who are not unionised, it would be advisable to add that function to the board. I ask the Minister to consider it. I might add that I will be tabling an amendment to that effect for Report Stage.
I remind the House that on Committees Stage technically we are requested to refer to what is in the section or any amendments that would aim to add something new to the section. Has the Minister any comment to make?
The function of the board would be to provide seminars, training sessions or whatever for the trustees. Generally it is the trade unions who make provision for the members. Obviously there will be a great deal of new information spread about by the board. Deputy Flaherty's point can be noted.
Question put and agreed to.
SECTION 11.
Amendments Nos. 14 and 15 not moved.
Section 11 agreed to. Section 12 agreed to.
SECTION 13.
Question proposed: "That section 13 stand part of the Bill."
Section 13 (1) reads: "The Board may accept gifts of money, land or other property upon such trusts or conditions (if any) as may be specified by the donor". Would the Minister give me an example of circumstances in which such might occur? Would he inform me what he has in mind with regard to that subsection?
It is really a standard provision.For example, somebody could leave a bequest to the board, some insurance company or whoever. Normally Deputy Byrne would be asking me to cater for all of these contingencies. The subsection really just provides for circumstances in which such a gift might arise. For instance, somebody might want the board to set up a trust for something, say to have some students undertake a study into some aspects pertaining to their area of study, when they might set up a trust for that purpose. It is a general provision and is safeguarded both ways because subsection (2) reads: "The Board shall not accept a gift if the trusts or conditions attached to it would be inconsistent with its functions." Therefore it will be seen that it is covered both ways: one, they may do it and, two, they may not do it if it is not appropriate. The provision is to be found in many Acts. It has nothing to do with Ministers, or gifts from Ministers.
Is Deputy Byrne happy with those who might bear gifts?
I do not envisage, say, the Insurance Corporation of Ireland, or whoever, making such gifts of money to the board.
In fairness, Deputies should not forget that the Banks Standing Committee gave a gift of £100,000 — which the Government matched with a corresponding £100,000 — in an endeavour to deal with the problem of moneylenders.It is unusual but can happen. Therefore, if somebody wants to do so it will be possible.
Question put and agreed to.
Section 14 agreed to.
SECTION 15.
Question proposed: "That section 15 stand part of the Bill."
Concern has been raised by the Irish Association of Pension Funds and a couple of other bodies in relation to how the chief executive will operate, bearing in mind the experience of other boards, with regard to sufficient powers being delegated. I wonder whether the provisions of section 15 (4) adequately meet the case? I am wondering whether the Minister has received such representations in relation to the chief executive, the adequate delegation of functions to him and whether the provisions of that subsection would be adequate to meet those concerns? From their experience with funds it is the association's belief that the chief executive would be required to operate more than simply on administration; he would have to have a substantial level of power delegated to him if he is to perform his function adequately. Would the Minister say whether the section, as drafted, adequately responds to such representations or whether he anticipates a problem arising in that respect?
Section 12 (4) reads:
The chief executive shall carry on and manage and control generally the administration and business of the Board and perform such other functions as may be determined by the Board.
The board can be requested by the Minister, so that there is a connection in that way to what the chief executive may be doing. They are the normal functions of the chief executive and, as far as I can ascertain, are adequate to cater for any circumstances that might arise. On the question of adequate consultancy, legal advice or whatever, in the first instance it would be a matter for the board and for the chief executive to take such advice as may be deemed to be necessary.
I gather the National Pensions Board recommended that the chief executive have certain specific powers reserved to him to allow speedy action, where required. I would imagine that would relate to circumstances in which legal action was involved, such as the sudden winding up of a scheme or a sudden crisis occurring within a scheme. I presume the Minister can ensure that the board should delegate such powers. However, the Irish Association of Pension Funds were concerned that it should be clarified that sufficient powers can be delegated, so that the chief executive could initiate action as required. For example, they recommended that the board would delegate such powers at its first meeting — I know that would not be a subject for the Bill — but that the chief executive would be obliged to report to the board as soon as possible having undertaken any serious action. We felt there might be a necessity to take urgent legal action occasionally and perhaps the Minister would say whether such circumstances would be adequately covered in this section.
The National Pensions Board did not propose that in legislation certain functions be reserved to the chief executive officer. They were concerned that the chief executive officer would have flexibility to act immediately but that is a matter for the board. I do not anticipate there will be any difficulty in that regard. As far as the board are concerned that would be one of the principal tasks of the chief executive officer who will be responsible to the board. Given the kind of people who will comprise the membership of the board I am certain they will maintain close contact with anything that might happen. Really it is more a question for the board themselves and the manner in which they carry on their activities.
Has the Minister any idea as to the salary scale of the chief executive officer? The Bill states that he shall hold office "on such terms and conditions, including terms and conditions relating to remuneration".
I am probably the worst person in the world to ask about that. I think so much about doing the job that I never think about the salaries. As the Deputy can see, these are the standard provisions——
I am sure the Minister for Finance will have a hand in it.
The salaries in the different semi-State bodies are standard. The Minister for Finance, of course, would be very much involved in the question of salaries, which would be laid down at the outset.
Question put and agreed to.
Sections 16 and 17 agreed to.
SECTION 18.
I move amendment No. 15a:
In page 14, subsection (2), line 16, before "specified" to insert "reasonable".
This matter was raised with me by the Irish Association of Pension Lawyers who made a very reasonable point. In earlier amendments we have increased the fines and the penalties, including possible terms of imprisonment, for persons who may contravene the provisions of this Bill. The power in this area is very wide.
I accept this amendment although it has to be adjusted technically.
I am glad to hear that. The section as it stands is very widely drafted. It proposes to make any employee or ex-employee personally liable regardless of their responsibility and capacity to respond. It could happen that a person would not have the information but because of the way this section is drafted they would be liable to an offence. Secondly, the person might be ill or might not be in a position to give the information for various reasons. It is important that a specified time is laid down, as proposed in another amendment in my name. Other Acts specify a particular time and in this case we would have to suggest what is a reasonable time. I would be interested to hear the Minister's views on this.
The Deputy has mentioned the second amendment which is technically in order and I can accept that as it is, but as regards amendment No. 15a, I will bring forward an amendment on Report Stage to deal with that matter. I accept the principle of what the Deputy is saying. Section 18 of the Bill provides that the board may carry out investigations into the operation of pension schemes. Subsection (2) gives them power to require an employer or the trustees, to furnish specified information within a specified period. Deputy Flaherty's amendment would insert the word "reasonable" before "specified". The draftsman advised me that the amendment is not technically correct. The phrase "within such reasonable period as may be specified" would be more appropriate, and the amendment would be acceptable on that basis. If the Deputy wishes, I will bring forward an amendment on Report Stage to cover that.
Amendment, by leave, withdrawn.
Amendment No. 15b. Amendment No. 15c is cognate, and therefore, the two amendments may be discussed together. Is that agreed? Agreed.
I move amendment No. 15b:
In page 14, subsection (5) (b), line 36, after "refuses" to insert "without reasonable excuse".
Given that we are establishing quite severe penalties, it is important to ensure that people are protected. There is a danger that the Bill as it is drafted at present could make employees of the board liable to offences without giving them any grounds on which to defend themselves. It is important that we should make an amendment along these lines and I am glad the Minister has indicated his willingness to do so.
I accept this amendment. Section 18 makes it an offence for an employer, trustee, etc. to refuse to produce information, material etc. when required, or to answer questions put to them. The insertion of the phrase "without reasonable excuse", as proposed by Deputy Flaherty, is accepted.
Amendment agreed to.
I move amendment No. 15c:
In page 14, subsection (5) (c), line 39 after "refuses" to insert "without reasonable excuse".
Amendment agreed to.
Amendment No. 16 not moved.
I move amendment No. 17:
In page 14, subsection (5) (i), line 43, to delete "at the discretion of the court".
Amendment agreed to.
I move amendment No. 18:
In page 14, subsection (5) (c) (ii), line 46, to delete "£5,000 or at the discretion of the court" and substitute "£10,000 or".
Amendment agreed to.
Amendment No. 19 not moved.
Section 18, as amended, agreed to.
SECTION 19.
Question proposed: "That section 19 stand part of the Bill."
I want to record my satisfaction that the draftsman has at last come around to the way of thinking of the Members of the Oireachtas in regard to this section. It is now worded correctly and does not discriminate against people who, under past legislation, would have been debarred from membership of the board or staff of the board if they were nominated to stand for election. In particular it applied to people in the Seanad who could be nominated without their knowledge and could be removed from the board on a technicality. This section ensures that people can hold these positions until such time as they are elected to the Houses of the Oireachtas or nominated as a member of Seanad Éireann. Section 19 meets all my reservations over the past 12 years.
Question put and agreed to.
SECTION 20.
Question proposed: "That section 20 stand part of the Bill."
This section states that the Minister may from time to time advance to the board out of moneys provided by the Oireachtas such sums as he may determine for the purposes of expenditure by the board in the performance of their functions. That seems to meet the point I was concerned about yesterday. It is clear that if the expenditure of the board became an excessive burden on the members, who would be the main subscribers to the cost of the scheme as initiated, it would be open to the Minister, under this section, to advance money to share the cost of the administration. That may not be the Minister's thinking at present. As I have said, the experience elsewhere has been that these schemes may consist of a very large number of staff and can involve very heavy costs which, in other countries, are carried by the Exchequer rather than by the schemes. If that situation was to arise here or to prove a problem, this section gives the Minister power to respond.
Question put and agreed to.
SECTION 21.
Question proposed: "That section 21 stand part of the Bill."
This is an important section because it sets down a standard which is not normally present in day-to-day affairs, particularly with regard to people in elected office, on the basis that they should be required to disclose interest, financial or otherwise. This section requires such declaration of any material or financial interest in any body corporate with which the board propose to make any contract. It is appropriate that there would not be a conflict of interest between a member of the board and anybody with whom they do business. That standard should apply to everybody elected to this House or to local authorities throughout the country. I am recording my appreciation of the fact that it is included in this format and I hope it will set a trend for future legislation.
Question put and agreed to.
Section 22 and 23 agreed to.
SECTION 24.
I move amendment No. 19a:
In page 16, subsection (1), line 43, after "member" where it firstly occurs, to insert "or chief executive".
As in most legislation, the disclosure of information is obviously of importance. It has been brought to my attention that perhaps it was a matter of omission that the chief executive was not referred to in the section.
This is a tidying up operation. It would make the section tidier if the chief executive was specifically mentioned; if he is seen as a member of the staff of the board, he may be covered.
The technical position is that he is regarded as and covered by the phrase "member of staff". Therefore, the amendment is not necessary.
Amendment, by leave, withdrawn.
Section 24 agreed to.
Section 25 agreed to.
Notice taken that 20 Members were not present; House counted and 20 Members being present,
NEW SECTION.
Amendments Nos. 20, 36, 45, 55, 66 and 91 form a composite proposal; amendments Nos. 37 and 38 are alternatives. It is proposed, therefore, to take amendments Nos. 20, 36, 37, 38, 45, 55, 66 and 91 together for discussion. As always happens, we can have separate questions on any of those amendments, but they will be taken together for discussion. Is that agreed? Agreed.
I move amendment No. 20:
In page 17, before section 26, but in Part II, to insert the following new section:
"26.—(1) (a) A question falling to be determined by the Board under section 37, 52, 57 or 73 shall be determined by it either, in its absolute discretion, without or after an oral hearing by the Board (or such member or members of the Board or other person or persons as the Board may authorise for that purpose).
(b) Any person concerned may make representations to the Board in relation to such a question as aforesaid and in reaching its determination the Board shall take account of any such representations.
(2) Representation under subsection (1) shall be made, in writing or, if an oral hearing is being held under subsection (1) in relation to the question concerned, at the hearing.
(3) The person or persons holding an oral hearing under this section shall have power to take evidence on oath and for that purpose any of the persons aforesaid may administer oaths to persons attending as witnesses at the hearing.
(4)(a) The person or any of the persons holding an oral hearing under this section may, by giving notice in that behalf in writing to a person, require the person to attend on such day and at such time and place as is specified in the notice to give evidence at the hearing in relation to the question to be determined by the Board or to produce at the hearing any documents in his possession, custody or control relating to any such question.
(b) A notice under paragraph (a) may be given either by delivering it to the person to whom it relates or by sending it by post in a prepaid registered letter addressed to the person at the address at which he ordinarily resides.
(c) A person to whom a notice under paragraph (a) has been given and who refuses to give evidence or gives false evidence at an oral hearing under this section or refuses or wilfully fails to produce any document to which the notice relates at such a hearing shall be guilty of an offence and shall be liable on summary conviction to a fine not exceeding £1,000.
(5) The person or persons holding an oral hearing under this section may order a person concerned to pay to any other person concerned a reasonable sum in respect of expenses occasioned by the person in relation to the hearing and any such sum may be recovered by the person concerned from the other person concerned, as a simple contract debt in any court of competent jurisdiction.
(6) Subject to the provisions of this Act, the procedure at oral hearings under this section shall be such as may be prescribed and regulations for the purposes of this subsection may, without prejudice to the generality of the foregoing, make provision for the notification of persons concerned of the making of representations under this section, of the date, time and place of such hearings and of determinations of the Board under sections 32, 52, 57 or 73, for the circumstances (if any) in which persons concerned may present their cases at such hearing through representatives (including legal representatives), for the making of a sufficient record of the proceedings at such hearings and for such other matters as the Minister considers necessary or expedient for the purposes of this section and for giving full effect to it."
I hope this amendment will meet the views expressed here by Deputy Ferris and Deputy Byrne on the other side of the House.
The purpose of the amendment is to insert a new section in Part II of the Bill setting out the procedure in relation to the determination of disputes by the board. The Bill, as originally drafted, provided under paragraph 24 of the First Schedule that the board should regulate by Standing Orders, or otherwise, such procedures. I have now decided that in view of the significance of many of the board's determinations concerning matters involving pension schemes these procedures should be dealt with under this part of the Bill dealing with the establishment of the pensions board itself.
Subsection (1) provides that any question falling to be determined by the board shall be determined by it, in its absolute descretion without or after an oral hearing.The board may consider that in many cases an oral hearing would not be warranted.Any interested party may make representations to the board concerning any matters submitted for their determination.Where the board consider that an oral hearing in the case is warranted they may authorise one of their members, or a member of their staff, to conduct such a hearing. Such persons will have the power to take evidence on oath from witnesses.
Subsection (4) deals with the procedures for giving notice to persons to attend such a hearing. Subsection (5) provides for the possible reimbursement of expenses to persons in attendance at such hearings in cases where it is considered appropriate. Subsection (6) provides for the making of regulations to deal with other procedural aspects of the board's business.
I commend the amendment to the House.
This amendment is a welcome improvement on the proposed legislation. It meets the points made by the Irish Congress of Trade Unions who pointed out that the board can make a decision which can be of vital significance and is the final arbiter in any conflict in relation to rights and entitlements under the Bill. It was important that the mechanism by which this would be done should be contained in the legislation. While the Minister has not spelled out other areas in the legislation I welcome the fact that he has adopted this one.
It is important that natural justice is seen to be done for members where a decision is made that they are entitled to increases or reductions in their pensions which obviously would have an effect on their living standards. Where that has been decided the procedures by which they may make their case should be clearly outlined and — to use that phrase again — should be transparent. People should see that justice is being done and that they have every opportunity to represent themselves in the manner in which they have become accustomed in other proceedings. This includes the possibility of legal representation which may be desirable given the nature and scope of the issues which may be decided by the board in relation to individuals or groups.
The Minister is to be congratulated for accepting that there is such a need and for making provision for this by way of his own amendment. I am stunned by the number of amendments which are consequential on this one and we may need some time——
I would like time to examine them.
The Minister's amendment which is both complicated and detailed proposes to insert a new section in Part II of the Bill. When I saw the list of amendments I realised that the Minister was making an attempt to meet the reservations expressed by congress and other interested parties. This amendment will strengthen an area of the Bill about which congress were extremely worried. Subsection (4) (c) states that a person on summary conviction shall be liable to a fine not exceeding £1,000. I ask the Minister to tell us if in setting that figure he took into account our views on the question of fines, and if he will indicate if it is in keeping with the increased penalties we had suggested and to which he had agreed.
The new section meets some of the major reservations expressed by congress and the procedure now laid down is quite comprehensive. I would like to ask a number of questions in relation to it. It appears that the appeals body is structured in a formal way. Can the Minister tell us on what basis an application will be decided at an oral hearing? I also seek clarification on whether guidelines will be laid down on which applications should go before an oral hearing. Given the issues involved, it is clear that this is a legal matter with those attending at hearings as witnesses having to take an oath. The amendment also states that the person concerned may bring a legal representative with them. It, therefore, appears to be a quasi-judicial appeals structure. I ask the Minister to indicate who will decide what applications will go before an oral hearing and what appeals mechanism will be available to someone whose application for an oral hearing has been rejected.
Subsection (5) of the amendment states that the person or persons holding an oral hearing may order a person concerned to pay to any other person concerned a reasonable sum in respect of expenses occasioned by the person in relation to the hearing and any such sum may be recovered by the person concerned from the other person concerned as a simple contract debt in any court of competent jurisdiction. I seek clarification on where this would leave the small man going before the board to claim that he is not receiving his pension entitlements.It is possible that he may have to employ actuaries or some other professional person to make the case for him. Is he likely to be met by an offputing list of expenses which would have to be met if he wishes to have his application dealt with?
The board will decide whether an application should go before an oral hearing. I do not want the matter to come back to the Minister. The board will have to decide in accordance with natural justice with the Minister having the power to give them instructions, if necessary, on the way in which they should carry out their duties. Naturally, both I and the House would be concerned that the arrangements they will make will meet the needs of the ordinary member. This would be a matter for the board in the first instance. I am quite sure that this is the way they would want it to be conducted, particularly given the fact that the trade unions and the workers will be represented on the board. I will have a look at the penalties listed before Report Stage.
Deputy Byrne referred to appeals. Under the section dealing with equal treatment, we will discuss a similar appeals system. I understand that a person will be able to appeal his case to the High Court. Will this option also be available to a person who brings an application under this section?
They may appeal the case to the High Court on a point of law.
Does this have to be specified, given that it is specified in the later section?
We do not envisage applications being appealed to the High Court. A person has the right under the law to go to court if they feel this is necessary. The appeals body in this case will be the Pensions Board and we are making provision for this. One of their functions is to monitor the operation of schemes. Consequently, they will be the competent appeals body.
Subsection (6) of the amendment states that subject to the provisions of this Bill the procedure at oral hearings shall be such as may be described. Does the Minister not think that the section could be strengthened through the inclusion of the word "shall"?
The regulations may be used for different purposes and will be used where there is a desire to do so. As I said earlier, it is only in very specific circumstances that we would need the word "shall". What we are doing is providing the power to make regulations.
Amendment agreed to.
Question proposed: "That section 26 stand part of the Bill."
The existing section 26 is in Part III of the Bill whereas the new section inserted by amendment No. 20 is in Part II of the Bill. Are we discussing the old section 26 or the new section 26?
There is a new section 26 as the old one is gone.
We are now discussing Part III of the Bill as the new section 26 is in Part II of the Bill.
We are now moving to section 27 and amendment No. 21 in the name of Deputy Byrne.
In relation to section 27 to which there is no amendment, I seek clarification——
On the original section 26.
This section deals with the preservation of benefits and states:
"qualifying service", in relation to a member of a scheme, means the aggregate of every period of reckonable service whether or not continuous in each case...
I wish to give the example of a married woman who returns to the workforce. She left her job at higher management level to get married, but on her return she can only obtain a position at a lower level, such as a clerical officer. I would like the Minister to inform the House which income will be taken into account in deciding on her pension. Will her pension be based on her average earnings before first leaving employment or her average earnings on her return to the workforce? Is provision also being made for the transfer of pension entitlement from one company to another? Would her service in the previous employment be taken into account in deciding qualifying service? Will my fears be confirmed that there is no such right even though the Minister may say there is? Will the example I gave cover every other scheme relating to any other employment in respect of which rights to long service benefit have been granted under the scheme in substitution for accrued rights under such other scheme?
It depends on the rules of the scheme. They will have to be considered.She will have to know them in advance and base her decisions on that knowledge. On the question of preservation, it depends on whether the person is going back to the same occupation, or to a different company, or to a lesser job in the same company, or to a lesser job in a different company. The Deputy's question depends on the rules of the scheme. The preservation will ramain the same.
It is my hope that there will be an element of common justice in the application of the rules. If a person can benefit from a totalling of the average income that should be available and not the terminating income which could be less.
We are working beyond the call of duty and beyond the call of order. Am I correct in saying that the House agrees that the original section 26 stands part of the Bill?
Question put and agreed to.
Sitting suspended at 1.35 p.m. and resumed at 2.30 p.m.
