HC Deb 02 December 1993 vol 233 cc639-40W
Mr. Bowden

To ask the Chancellor of the Exchequer (1) how much of the total amount of money raised by measures to restrict the amount of tax which can be reclaimed by a pension fund introduced in the last Budget will be paid by members of money purchase occupational schemes in the form of a reduction in the assets available to purchase a pension;

(2) how much of the total amount of money raised by measures introduced in the last Budget, to restrict the amount of tax which can be reclaimed by a pension fund, will be paid by employers in the form of additional contributions;

(3) how much of the total amount of money raised by measures to restrict the amount of tax which can be reclaimed by a pension fund introduced in the last Budget will be paid by individuals paying additional voluntary contributions into occupational schemes in the form of a reduction in assets available to purchase a pension;

(4) how much of the total amount of money raised by measures introduced in the last Budget, to restrict the amount of tax which can be reclaimed by a pension fund, will be paid by pension funds in the form of a reduction in assets;

(5) how much of the total amount of money raised by measures to restrict the amount of tax which can be reclaimed by a pension fund introduced in the last Budget will be paid by holders of personal pensions in the form of a reduction in the assets available to purchase a pension.

Mr. Dorrell

The impact of the changes in the taxation of dividends announced in the March Budget on contributions to, and the assets of, pension funds will depend upon a wide range of factors including future rates of return on investments, earning levels and the existing levels of assets and liabilities.

Mr. Bowden

To ask the Chancellor of the Exchequer how much tax will be raised in a full tax year by the measure introduced in the March Budget restricting the amount of tax which can be reclaimed by a pension fund.

Mr. Dorrell

The overall Exchequer yield from the changes in the taxation of dividends announced in the March Budget is estimated to be £900 million in 1995–96 and about £1 billion a year subsequently.

Mr. Bowden

To ask the Chancellor of the Exchequer (1) what discussions his officials have had with officials in the Department of Social Security on the extent to which the tax changes affecting pension funds introduced in the March Budget are likely to affect the number of people relying on various forms of private pension provision;

(2) what discussions his officials have had with officials in the Department of Social Security on the extent to which the tax changes affecting pension funds introduced in the March Budget are likely to affect the numbers contracting out of SERPS.

Mr. Dorrell

Regular discussions take place between officials of my Department and Department of Social Security officials on a wide range of topics affecting pension funds.

Mr. Bates

To ask the Chancellor of the Exchequer what discussions his officials had with officials of the Department of Social Security before changing the taxation of the income of pension funds in the March Budget.

Mr. Dorrell

The potential effects of changes to the taxation of dividends announced in the March Budget were taken fully into account in developing the proposals. Issues affecting pensions are the subject of regular discussions between my officials and those of the Department of Social Security.