Pension lawyers have, by and large, greeted with relief the government's decision to accept the majority of the Goode pension law review committee's recommendations for the reform of the industry (see [1994] Gazette, 6 October, 11).A package announced last week by social security secretary Peter Lilley accepts 185 of Goode's 218 recommendations, including a new occupational pensions regulator to carry out spot checks and look into alleged irregularities; a requirement that funds have sufficient resources to honour their commitments; and a right for members to nominate up to a third of scheme trustees.The reforms, outlined in the white paper 'Security, equality, choice', are due fo r implementation in April 1997.'The proposed changes are designed to achieve the greatest practicable security in all schemes without imposing unnecessary burdens on those that are well run,' Mr Lilley said.The head of Rowe & Maw's pensions department, Stuart James, current chairman of the Association of Pension Lawyers and a member of the Goode committee, greeted the government's plans as 'a qualified relief ', voicing disappointment that the Inland Revenue had given so little ground on the tax aspects of pension funds.Under the Lilley proposals, pensions lawyers will see their role given sharper focus in a formal letter of appointment setting out the terms of reference for the scheme's legal adviser.'This isn't going to be a bandwagon for lawyers.

But it might stop pension schemes from picking firms for different bits of advice, and it might benefit some firms if schemes concentrate their work in some practices,' Mr James said.Harriet Dawes, pensions partner with Lovell White Durrant, added: 'People were very gloomy about what was going to come out of this, but the government has in fact come out with recommendations which, if they go through, will go quite a long way to clarify the obligations of employers and therefore the rights of members.'She felt that a letter of engagement was 'absolutely essential'.

'It makes quite clear who you are acting for, and anything leading to greater clarity for employers as to what their obligations are is to be welcomed,' she said.The head of Travers Smith Braithwaite's pensions department, Paul Stannard, said that what the government was proposing was 'good news for pensions scheme members as a whole'.He expressed the hope that schemes would not become 'bogged down with compliance costs', as had happened under the 1980s financial services reforms.But a dissonant note was sounded by Ian Pittaway, partner with Nicholson Graham & Jones and former chairman of the Association of Pension Lawyers.He condemned the Lilley package as providing 'no material increase in security for members, while leading to over-regulation and increased costs'.'The proposals will create quite a lot of work for lawyers, given the quite considerable changes in schemes' documentation that they will bring about,' Mr Pittaway said.He also forecast an increasing trend toward split representation of employers and trustees.Trade union lawyers Russell Jones & Walker have attacked the proposal that fund members will make up only one third of the boards of schemes.RJW partner Edward Cooper said: 'Only equal representation on both sides will ensure fair and legal play with pension assets.

We shall be joining the trades unions as part of a concerted lobbying campaign to influence the progress of this proposed legislation.'Meanwhile, Mr Lilley also announced that schemes would be required to keep pace with prices by indexing pension payments, subject to an annual maximum of 5% and would be required to provide clearer information to their members.A compensation scheme, paid for by the pension funds, would cover up to 90% of losses resulting from an employer's dishonesty or insolvency.The pensions regulator - funded by a £10 million per year levy on schemes - would consist of a full-time chairman, supported by six part-time members with specialist knowledge of pensions law and practice.All would be appointed by the secretary of state and supported by a team of experienced investigators and pensions experts.'Investigators would follow up reports of irregularities.

The regulator would also be able to ca rry out spot checks,' Mr Lilley said.

Sanctions available are officially still under consideration, but could include suspension, removal or disqualification of trustees.Schemes will have five years to adapt to the new minimum solvency requirements, the calculation of which will be based on the cash benefits accrued by members under the scheme assuming the transfer values members would receive if they left the scheme before retirement.The DSS says the new requirement will cost industry £200 million a year over the next ten years, though this figure has been disputed.The National Association of Pension Funds gave a broad welcome to the white paper but chairman Ron Amy said: 'The regulator should not be industry funded.'Regulation should be paid for by the state if - as we believe - it is in the national interest for pension funds to be regulated effectively,' he said.In a separate announcement, the Department of Social Security detailed moves to ensure that occupational pension schemes provided equal benefits for men and women.In future, women on paid maternity leave will be treated, for pension purposes, as if they had worked normally at their standard rate of pay, but need only pay pension contributions based on their actual rate of pay, including statutory maternity pay.-- 'Security, equality, choice: the future for pensions', HMSO, £8.40.