§ Mr. Austin Mitchell
To ask the Chancellor of the Exchequer (1) what is his estimate of the value of the pension contribution holidays which have been declared by public companies for the benefit of(a) their shareholders and (b) their employees in each of the past three years to date; and what has been the benefit to the revenue therefrom;
(2) what is his estimate of the amount which public companies have appropriated from their pension funds for the benefit of their shareholders in each of the past three calendar years and current year to date; and at what rate such appropriations are subject to tax having regard to the relief given in earlier years.
§ Mr. Norman Lamont
Full information in the form requested is not available. Information from large self-administered pension schemes taking action to reduce surpluses following the legislation in the Finance Act 1986 is given in the table. Refunds to employers are subject to a flat rate of tax of 40 per cent.
£ million Schemes reporting in: Action to reduce surplus 1986–87 1987–88 19881 Refunds to employers 62 69 94 Contribution holidays or reductions for employers 2 253 444 Contribution holidays or reductions for employees — 14 15 1 April to September.
Note: The figures represent for each activity the total amount of surplus to be eliminated by schemes which have reported in each year. The contributions holiday or reduction may be spread across several years.