Viscount Trenchard (Con)

My Lords, I will not go into too much detail. I should, because I was not here last week, declare an interest, in that I am a director of a Guernsey-based, open-ended protected cell company and a London-listed, closed-ended investment company. Neither of them begins to approach the necessary size to qualify under the scale criteria that this Bill introduces. I agree entirely with the points made by my noble friends Lady Noakes, Lady Neville-Rolfe and Lord Fuller and the noble Baroness, Lady Altmann. Scale is nothing to do with this. I find it quite extraordinary that the Government assume that big is good and small is bad. All big funds were once small: they started with nothing and built up. There is also some evidence that, if you get really big, you become a big complacent and do not have to be quite as sharp as you do when you are making a small fund bigger and more successful and establishing its reputation. Interfering with the fiduciary duties of pension fund trustees in this way is risky, bad, potentially dangerous and unlikely to be in the interests of the pension beneficiaries, so I strongly support all the amendments in this group. I do not think that the minimum size of a master trust should be specified in the Bill. Trustees will have their own criteria for the maximum proportion of funds that they may own in any one fund, and for the maximum percentage of their funds’ assets that may be invested in any one fund. I think these are better ways to achieve the obvious need to reduce risk, and pension fund trustees are the right people to deliver them.