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National Insurance Fund

Volume 470: debated on Thursday 10 January 2008

To ask the Secretary of State for Work and Pensions what assessment he has made of the effect of employers paying employee pensions contributions at the reduced rate on national insurance fund revenue in the last three years. (173578)

The information is in the following table.

Cost of contracted-out rebate

£ billion

Tax year

2004-05

2005-06

2006-07

Type of scheme

Employer

Employee

Employer

Employee

Employer

Employee

Occupational DB

4.6

2.1

4.8

2.2

5.0

2.3

Occupational DC

0.1

0.3

0.1

0.3

0.1

0.3

Note:

1. Rebate expenditure for all years is estimated and based on the latest available contracting-out data in ‘Second Tier Pension Provision’.

2. Figures are for the UK and expressed in cash terms.

3. The cost of paying the rebate will be balanced in the longer term by a reduction in the cost of the additional state pension.

Source:

Department for Work and Pensions