Yesterday in Parliament it was just brilliant to hear Rt Hon Liam Byrne MP speak in support of the amendment he tabled (NC17) to the Pension Schemes Bill. 33 other MPs from a range of parties have lent their names to this critical amendment.

The amendment, if passed into law, will clarify the fiduciary duties of UK pension schemes. This overdue reform could unlock significant investment in the domestic economy of the UK by giving explicit legal permission to schemes to consider factors such as their members’ standards of living, members’ views, and the impacts of scheme investments when making investment decisions.

This proposal is strongly aligned with the policy objectives of the UK government’s pensions reform agenda, including the Bill itself.

It was hugely welcome to hear Torsten Bell, the Minister for Pensions, “agree that more clarity about the ability of trustees to take into account such factors would help.” He also agreed, “There is good support in the [pensions] industry for providing that clarity, giving added confidence to trustees that they can invest in the long-term interests of their members and our society.”

The minister has committed to legislate to address the confusion over legal duties of pension scheme and their trustees, which we warmly welcome. Statutory guidance, as the minister proposed yesterday, is necessary. However, statutory guidance alone would not address legal uncertainty since it need not be followed, and, on its own, is at risk of potential misuse by a future government. Such problems could be avoided and the current lack of clarity would be resolved with legislation backed by statutory guidance, as proposed in Amendment NC17.

The Bill now moves to the House of Lords. Stay tuned for further debates and developments.

The idea that trustees can individually determine the best for the member leads us to members choosing for themselves, the Thatcherite ideal of self-determination on where retirement funds are invested- each according to their personal beliefs with the state standing aside.

Trustees want to determine what they think is best for members in DC schemes by complying to a view that global diversification according to market weights is least likely to go wrong. The idea that being “passive” to what the markets tell us is how DC defaults should be invested is predominate.

The approach taken by this Government when it comes to such investment is to intervene and threaten mandate because fiduciary duty leads to a conformity around passive acceptance of what passive global diversified funds tell us. It is infact capitulation.

Those who want our pensions to invest not just for the financial good of the few but the social improvement of the many, are ready for our pension fund to adopt the Mansion House agreement and want trustees to as increasingly our best funds do. Look to where best practice is happening and look for the LGPS pools – which are now down to a hard core of active managers, look to the investment strategy of Nest and Peoples and the other large DC funds and here you see an approach to the needs not just of members but to the society that they will live in.

Share Action have known for decades that intervention is needed for good to win through and they are right to be heard in parliament through Liam Byrne and behind him Torsten Bell.