HC Deb 26 March 1999 vol 328 c432W
Mr. Russell Brown

To ask the Secretary of State for Scotland if he will make a statement on the report by the Government Actuary on his investigation of the National Health Service Superannuation Scheme in Scotland for the period from 1 April 1989 to 31 March 1994. [79338]

Mr. Dewar

I have accepted the report and today placed copies in the Library.

The report concludes that it would be prudent to increase, in the medium term, the rate of contribution required from employers to meet the scheme's future liabilities. The Government Actuary is content with our proposals that the current rate of 4 per cent. of pensionable pay can be maintained until 31 March 2002. Assuming that experience is in line with the assumptions he has made, it will increase to 5.5 per cent. from 1 April 2002, with a further increase to 7 per cent. from 1 April 2005.

The cost of index-linking National Health Service pensions is currently met by the Exchequer. As the report notes, I have agreed with my right hon. Friend the Chief Secretary to the Treasury that, in principle, the Scheme would assume its pension increase liabilities from 1 April 1994 under a financial restructuring and our officials are discussing the basis of such changes. In the meantime, the Government Actuary considers that the proposed increases in employer contribution rates are consistent with the nature of the changes likely to be required under the restructuring.

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