HC Deb 05 March 1998 vol 307 cc718-9W
Mr. Gibb

To ask the Chancellor of the Exchequer if the Government's proposal to introduce resource accounting includes accruing for the Government's unfunded liabilities for pay-as-you-go state pensions. [32794]

Mr. Geoffrey Robinson

[holding answer 3 March 1998]: The Government propose to publish separate scheme statements for the main departmentally administered occupational public service pension schemes alongside departmental resource accounts. The schemes include the Principal Civil Service Pension Scheme, the Armed Forces Pension Scheme, the Teachers' Superannuation Scheme and the NHS Superannuation Scheme. Although the Statement of Recommended Practice "Financial Reports of Pension Schemes" does not apply to unfunded pension schemes, its recommendations represent best practice for pension scheme accounting in the UK and the Treasury is developing with departments scheme statements which conform as far as appropriate to this best practice. The unfunded liabilities of these schemes will be disclosed as part of the Actuary's Report. For these schemes, contributions (or any government finance out of which contributions are paid) to meet the accruing cost of pensions will be included in departmental resource accounts and budgets.

The Government do not propose to include state pension liabilities in departmental resource accounts because they do not believe that it is meaningful to do so in order to provide a realistic balance sheet at departmental level. However, the Government recognised at an early stage in the development of resource accounting and budgeting that potentially different arguments might apply in considering the production of a balance sheet for the public sector as a whole.

The Government are currently carrying out a joint scoping study with the National Audit Office into the desirability, practicalities, timescale and resource and other implications of preparing a consolidated set of financial statements for the public sector as a whole ("whole of government accounts"). In assessing the case for proceeding within the preparation of whole of government accounts, the study will consider whether the coverage of such accounts should include Government liabilities, including state pension liabilities. The report of the scoping study will be published in the summer.