To ask the Secretary of State for Work and Pensions what impact he expects the Pensions Bill to have on the returns delivered by the financial markets to pensioners over the expected life of those expected to contribute under its proposed arrangements. (127520)

The introduction of personal accounts will enable more people to benefit from investment returns in financial markets and to receive higher incomes in retirement. We expect approximately £4 billion-£5 billion of additional savings per year as a result of personal accounts.

The impact on financial markets of such a savings increase is likely to be limited. Funds under management in personal accounts are expected to be invested in a diversified portfolio and are expected to be small compared to existing financial markets. As a result, we would not expect the rates of return delivered by the financial markets to pensioners to be affected significantly by the introduction of personal accounts.