§ Ms LawrenceTo ask the Chancellor of the Exchequer when the pooled pension investment will be available; and what investments will be eligible for inclusion. [93814]
§ Ms HewittThe Government have decided to introduce pooled pension investments (ppis) in April 2001, to coincide with the introduction of stakeholder pensions.
The joint Treasury and DSS consultation paper "Helping to deliver stakeholder pensions: flexibility in pension investment" suggested that ppis could help the successful launch of stakeholder pensions. Most responses to the paper agreed, and many pressed for a joint introduction. Also, financial services firms are still dealing with year 2000 compliance, and many will be introducing change freezes around the millennium period. It therefore makes good practical sense to introduce the two reforms together.
The Government will allow ppis to hold units in
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- authorised unit trusts,
- open-ended investment companies,
- investment trusts with separate custodians and gearing at or below 50 per cent., and
- single gilts
These investments offer appropriate security and risk spreading for savers. They also give the flexibility required to match investments with the length of time from retirement. Again this is consistent with the responses from consultation, and strikes the right balance between minimising investment risk and allowing choice and innovation.