§ Mr. SayeedTo ask the Chancellor of the Exchequer, pursuant to his answer of 2 March 1999, Official Report, column 642, on pensions, what large financial penalties 89W are currently incurred by members moving from an occupational pension scheme; and how a pooled pension investment could be used to reduce these. [83706]
§ Ms HewittPeople who leave defined benefit occupational pension schemes in mid-career get paid up rights or transfer values which, depending on the terms of the scheme, are often worth appreciably less than the pension rights their period of service would have earned at normal retirement age. Those who leave a job after a short period often get nothing.
In contrast, defined contribution pension schemes of all kinds provide individual investors with their own defined pension fund, allowing them to move jobs without these financial penalties. Pooled pension investments will be a particularly transparent vehicle for defined contribution schemes.