(LD): My Lords, with
the leave of the Committee I will speak in the gap about two
specific issues related to private sector pensions, both of which
are fairly current and have raised their heads in the last few
days. The first relates of course to the GKN/Melrose acquisition
battle. I call it a battle because it looks, sounds and feels
like one. The issue of those who work for, or have retired from,
GKN is a live one. Just two days ago the chair of the Business,
Energy and Industrial Strategy Committee in the other place wrote
to the chief executive at Melrose Industries following the
committee’s meeting with them, in which she set out a requirement
to inform the committee of Melrose’s plans for applying for
clearance from the regulator prior to acquiring the company. That
was a result of the company itself having come under scrutiny
from the Pensions Regulator, which asked whether it would apply
for the voluntary clearance that is all that happens under the
current powers of the regulator. The question that arises—given
that this is about a principle, not just that specific matter—is,
when will the Government be bringing forward the promises they
made in their manifesto? To quote the Financial Times, the,
“party pledged to boost the Pension Regulator’s powers so it
could veto deals which could harm pension scheme members”.
That is the question that arises in principle about mergers and
acquisitions for the future...
(Con):...The final point that I will make in the time
allowed is about GKN and Melrose, raised by the
noble Lord, . It would not be appropriate
for Ministers to comment on individual cases. They are a matter
for the independent regulator, and therefore we cannot discuss
the specifics of this case. The regulator operates a statutory
clearance procedure to provide greater certainty for those who
are considering transactions involving companies with defined
benefit schemes. If clearance is not applied for and granted, the
regulator may exercise its powers up to six years after a
transaction has taken place if it considers that the transaction
was aimed at avoiding a debt for the pension scheme...
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