Lord Davies of Brixton (Lab)

I do not mean to be unkind to the tablers of this amendment, but it is nonsense, in my view. As the noble Lord, Lord Fuller, explained, I can confirm that I am a fellow of the Institute and Faculty of Actuaries. To be honest, this amendment would mean more work for actuaries, on the face of it. Who will do these independent assessments? It is presumably people who know what the technical nature of a pension scheme is—to that extent, maybe I am not against the amendment. It suggests that it should be benchmarked against two things that are irrelevant. The Local Government Pension Scheme is not insured. It is not invested totally in gilt-edged securities. You could calculate those figures, but what do they tell you? Absolutely nothing. The fundamental problem with this proposal is that it is the administering authority that decides on the contribution rate, not the actuary. It is not the actuary who decides how much prudence should be in the figures. The actuary provides advice and the administering authority decides. If, for whatever reason, the administering authorities feel that they do not have enough control over the situation then that is a matter for them to sort out. It does not require legislation to say that administering authorities should do their job—it is already their job, and they should get on and do it. Finally, even if an appropriate level of prudence was applied when deciding the contribution rate, that money—which, for the sake of prudence, is paid into the fund—is not lost and has not disappeared. It is still available and will be available for the purposes of the scheme; it will be taken into account the next time there is a valuation. Valuations roll on one after the other. If perchance, because of incorrect advice, a bit too much money is put in initially then it will be there at the next valuation and will be taken into account. Presumably the administering authority, as long as it is doing its job, will adjust the contribution rate appropriately. What we have in the amendment is additional unnecessary bureaucracy and, as far as I can see, the only people who will gain will be the professional advisers.