Baroness Stedman-Scott (Con)

My Lords, I thank those taking part in this interesting debate, and the Minister for his response. I completely agree with the noble Lord, Lord Davies of Brixton, that discussion and consultation is best first. I will take advice on the naming of the authority, and I will certainly take advice on speaking to Kwasi Kwarteng. This is not a matter of political inheritance; it is a matter of changed circumstances. In 2022, when many Local Government Pension Scheme funds were still in deficit, higher employer contribution rates were, on balance, the correct and responsible course of action. At that point, the application of prudence, both actuarial and contribution-based, were broadly aligned with the financial position of the scheme. What has changed is the context. Market conditions have shifted materially in recent years. Higher interest rates, improved funding positions and stronger asset values have transformed the balance sheets of many funds. This has been underscored by the most recent triennial valuation in 2025, which has revealed the scale of surplus that was neither anticipated nor problematic in earlier cycles. It is precisely at this point that the interpretation of the regulations, particularly Regulation 62(6), has come to the fore. The issue is no longer whether prudence is appropriate but how it is being applied in a materially different financial environment. Rules that operated sensibly when schemes were in deficit are now, through interpretation rather than legislation, producing outcomes that risk becoming disproportionate and unaffordable. That is why the amendment matters. It is not an attempt to rewrite history or to relitigate past policy decisions; it is a forward-looking attempt to ensure that a regulatory framework designed for balance and sustainability remains fit for purpose as conditions change. This should not be a partisan issue. It is about ensuring that regulation keeps pace with reality, that prudence remains proportionate and that employers are not locked into contribution levels that no longer reflect the underlying financial position of the scheme. I hope noble Lords have appreciated the spirit in which we have tabled these amendments but, for now, I beg leave to withdraw the amendment.