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Pensions Bill

Volume 461: debated on Thursday 14 June 2007

To ask the Secretary of State for Work and Pensions what estimate he has made of the cost to the Treasury of implementing the effects of Lords Amendments 68 to 76 to the Pensions Bill. (142568)

We have not worked out the exact cost of implementing the amendments as they are somewhat contradictory in effect and may be technically deficient. The intended effect would appear to be payment of PPF levels of benefit to those qualifying for FAS schemes (costs below). The amendments would also extend the level of benefits to an unspecified number of pension schemes in wind up with a solvent employer, costings for which will not be available until after the report of the review of FAS scheme assets. There would be very significant implementation costs in setting up and running the institutions proposed but these have not been costed.

Paying PPF level benefits to the current set of qualifying FAS schemes would cost around £2.5 billion in NPV terms (£640 million in addition to the budget extension) and £10.6 billion in cash terms (an additional £2.7 billion on the Budget extension).