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14 -
(a)
(b)
it may not be easy to determine whether or not clauses 44 and 45 actually provide for the making of regulations or rules in respect of a particular provision. For example, it would be difficult to relate the general powers in clauses 44(1)(b) and (h) to individual provisions;
even if this issue could be resolved, the question would remain of whether the requirement to make all necessary regulations and rules had been satisfied. For example, what the position would be if some, but apparently not all, regulations and rules had been made in relation to a particular provision? What would happen if a legal challenge was made on these grounds to the very essence of the MPF - i.c. clause 6? Allowing for decisions based on opinion leads only to uncertainty. Our workforce deserves better than that. It is clearly unacceptable that the power to apply statutory provisions of public importance should be subject to such inherent uncertainty, and I urge Members to oppose any CSA that might be moved to that effect.
Portability or transferability of accrued benefits
I turn now to protability or transferability of accrued benefits. It has been our policy intention to allow persons changing jobs the choice of leaving their accrued benefits in the form of individual accounts with the trustee who runs the master trust scheme of their former employer, or to transfer their accrued benefits to the scheme run by the trustee for the new employer. No one would therefore be compelled to leave a master trust scheme, run for his former employer, which has been doing well and may produce a higher rate of return. Similarly, no one would be forced to move to a scheme, operated on behalf of the new employer, which might not be doing so well. We think that this would reduce the frequency of transfers of accrued benefits.
We believe that Clause 13 of the Bill, as drafted, provides for that choice already. Some Members, however, have contended that the clause does not reflect our policy intention. To put the matter beyond doubt, I shall move a CSA later on.
Some Members have expressed concern that transfer costs might be significant. Now, the process of transfer is straightforward and should not incur any significant cost. However, for the better protection of accrued benefits, we can make sure that the subsidiary legislation will provide that, except for the incidental costs and expenses of remitting the money involved, no deductions shall be made against the accrued benefits under transfer.