Viscount Younger of Leckie (Con)

My Lords, in response to the noble Lord opposite, I can confirm that my opening remarks will be relatively short. Amendments 21 and 22, tabled in my name and that of my noble friend Lady Stedman-Scott, are largely probing amendments, directed not at altering the policy intent of the Bill but at testing the completeness of the framework that it sets out. Clause 8 is an interpretation clause. It defines what is meant by the management of Local Government Pension Scheme funds and assets for the purposes of this chapter, and it does so by listing a number of illustrative activities. As drafted, those activities focus primarily, though not exclusively, on investment decision-making—that is, buying and selling assets, setting asset allocation, establishing pooled vehicles, selecting investments and so on. We fully accept that the clause makes it clear that this list is non-exhaustive. The phrase “include (among other things)” is well understood. None the less, what appears in a Bill still matters. It signals what Parliament understands to be central to the concept being defined and it shapes how subsequent powers are interpreted, exercised and defended. That is the purpose of these amendments. Amendment 21 would make it explicit that “management” includes ensuring that activities comply with relevant laws and regulatory rules. Amendment 22 would similarly make it explicit that “management” includes handling risks, including how they are identified, assessed and kept under review. Neither amendment seeks to impose new duties or redefine existing obligations. Both simply ask whether the Government agree that compliance and risk governance are not peripheral but intrinsic to asset management. Local Government Pension Scheme managers are fiduciaries; they operate within a dense web of statutory, regulatory and prudential requirements. Ensuring compliance with those requirements is not an administrative afterthought but a core managerial function. Likewise, risk management is not something that follows investment decisions; it informs them at every stage. The reason why we raise this issue is not theoretical. Elsewhere in the Bill, powers are framed by reference to the management of scheme assets, and it therefore seems reasonable to ask the Minister to confirm on the record, if he could, that when the Government use that term it is intended to encompass the full spectrum of responsibilities that scheme managers already discharge, including legal compliance and risk oversight. In other words, is the Bill deliberately neutral as to those aspects because they are already assumed, or does the narrower emphasis of the illustrative list reflect a more constrained conception of management, one focused primarily on asset pooling and allocation? Our amendments invite that clarification. In legislation of this kind, when significant powers are being taken and fiduciary duties are central, it is important that Parliament is clear about the assumptions that underpin the language being used. Therefore, I hope that the Minister can reassure the Committee that the Government agree that compliance with law and active management of risk are integral to the management of the LGPS assets, and that nothing in the Bill is intended to narrow or sideline those responsibilities. On that basis, I look forward to the Minister’s response and clarification, and I beg to move.