Member

Similarly, Amendment 40, again from my noble friend Lord Davies, would have the effect of requiring an employer to consult before consenting to the release of surplus. As he described, Section 259 of the Pensions Act 2004 sets out a mandatory consultation process that must be followed when certain decisions are taken by an employer in relation to an occupational pension scheme—for example, a decision to close a scheme to future accruals. If employer consent to a surplus payment was made a prescribed decision under Section 259, it would add those additional requirements to be met, making it less likely that both employers and members would benefit, as is the policy intent. We maintain that trustees are best placed to decide whether surplus release is appropriate and what conditions, such as benefit improvements, should be attached to that.