Baroness Altmann (Non-Afl)

On behalf of the noble Baroness, Lady Coffey, who is unable to be here today, I am happy to move her Amendment 112 and speak to the others in this group. My remarks on Amendment 112 also apply to the noble Baroness’s Amendment 117 and Amendment 114 tabled by the noble Baroness, Lady McIntosh. The aim of this amendment is merely to ensure that, in new Section 28C, which says that master trusts or GPPs will require regulatory approval of their asset allocation—and that that will require that at least the prescribed percentage by value of the assets held in the default funds of the scheme are qualifying assets—the maximum value should be no greater than the Government’s expressed aim of 10%. As far as Amendment 114 is concerned, the UK element of that should not be more than 5%. The aim is to avoid policy creep. If there is mandation and it prescribes a percentage in particular assets, this should not then be used as the basis for perhaps increasing the element of mandation, given that there is no figure in this instance in the Bill. My Amendment 113 is on a slightly different aspect. In the case of regulatory approval being required for asset allocation and a prescribed amount of qualifying assets being required, I would like to add the possibility—this is a “may” not a “must”—of the minimum amount in prescribed assets being part of the flow rather than the stock. My concern—it has been mentioned on other groups, and I am sure we will come back to it—is that, by prescribing a percentage of assets in a very illiquid range of assets as the proportion of the already-existing stock of funds in a default fund, there is a danger that all the new contribution flows will need to be directed to that particular type of asset to end up with an overall percentage of the whole fund in the required prescribed assets. My suggestion is that the Government might want to have the option of just mandating—if they do so, which they may or may not—a proportion of the new contributions, which will perhaps be less disruptive to the market in the underlying assets. I support all of the amendments in this group. I am also supportive of the idea that the noble Viscount, Lord Younger, and the noble Baroness, Lady Stedman-Scott, are recommending and which the noble Lords, Lord Vaux and Lord Palmer, are suggesting, of moving away from the idea of mandating just private equity—or, indeed, just private equity and private debt—and having a wider range of options for meeting the Government’s intention, which I support, of bolstering pension fund support for new companies and growth assets in the UK that can help support and boost both the long-term growth of this country and the returns of the UK’s pension funds over the long term. I beg to move.