HC Deb 14 July 2003 vol 409 cc80-3W
Mr. Colman

To ask the Secretary of State for Work and Pensions what representations his Department has received in relation to charity sector involvement in the new Employers' Task Force on Pensions; and whether the Employers' Task Force on Pensions will be seeking further representations from the charity sector. [120043]

Malcolm Wicks

The Charity Finance Director's Group (CFDG) have written to my right hon. Friend the Secretary of State and to Sir Peter Davis, Chairman of the Employer Task Force on Pensions, regarding charity sector involvement.

Membership of the Employer Task Force was announced in the answer given by my noble Friend the Parliamentary Under Secretary of State for Work and Pensions, Baroness Hollis, on 5 June 2003, Lords Official Report, column 188-89WA. Within a small Task Force not all sectors could be individually represented. However members have been appointed on their own merit and Lucy Anderson brings experience of the charity sector, from her previous work at SCOPE.

CFDG have also provided a submission to the Task Force. It will be for Sir Peter Davis and the Task Force to consider whether they wish to seek further representations from the charity sector.

Mr. Heald

To ask the Secretary of State for Work and Pensions what the(a) estimated current level of funding of occupational pensions schemes and (b) proportion of

Estimates based on current MFR basis Estimates based on MFR basis operating in May 1997
Level of funding against the MFR taking together all schemes subject to the MFR1(Percentage) 106 98
Proportion of schemes below 100 per cent, funded on the basis of the MFR2(Percentage) 50 75
Aggregate MFR deficit across all schemes below 100 per cent, funded on the basis of the MFR3 (£ billion) 30 60
1 These estimates indicate total scheme assets expressed as a percentage of totalscheme MFR liabilities.
2 Rounded to the nearest 5 per cent.
3 Rounded to the nearest £5 billion.

Mr. Heald

To ask the Secretary of State for Work and Pensions what changes have been made to the basis for minimum funding requirement since May 1997; and what effect the changes have had on the demonstrated level of funding of a typical pension scheme. [124023]

Malcolm Wicks

The actuarial basis for the minimum funding requirement (MFR) is kept under review by the Faculty and Institute of Actuaries. They have recommended two substantive changes to the basis since May 1997, and both were implemented. From 15 June 1998 the factor for the equity market value adjustment, which generally applies to the calculation of liabilities for scheme members below pension age, was reduced from 4.25 per cent. to 3.25 per cent. and the gross yield on the FTSE Actuaries All-Share Index was replaced with the net yield on the same index. From 7 March 2002 the factor for the equity market value adjustment was further reduced, from 3.25 per cent. to 3.00 per cent. The changes were intended to address movements in the strength of the MFR test resulting from changing economic and demographic trends. In addition to these changes there have been a number of minor technical amendments to the actuarial guidance which governs the calculation of a scheme's MFR liabilities.

It is not possible to define a typical pension scheme, but estimates1 about the effect of these changes on the aggregated MFR funding levels of all schemes subject to

schemes in deficit is, with the aggregate size of those deficits, is using (i) the present basis for minimum funding requirement and (ii) that which operated in May 1997. [124022]

Malcolm Wicks

Information about scheme funding levels as assessed on the basis of the minimum funding requirement (MFR) is not routinely collected. Estimates prepared by the Government Actuary's Department, based on economic conditions in June 2003, are set out in the table1.

1 These estimates are based on MFR data collected from the actuarial profession from consulting actuaries and insurance companies on the MFR funding levels of a sample of just over 1,000 schemes that had an MFR valuation with an effective date between April 1997 and April 2000. The sample may under-represent certain types of schemes, for example smaller schemes. These data have been broadly adjusted to reflect economic conditions in June 2003 using assumptions about the investment policies of the schemes involved: figures for a different date could well give different results depending on movements in market conditions. However, the exact position now on the MFR basis as it operated in 1997 cannot be known exactly, as the financial indicators specified for use in the calculations originally are no longer publishd in the same form.

the MFR have been prepared by the Government Actuary's Department. These indicate that the change which took effect from 15 June 1998 may have increased aggregate funding levels against the MFR by around 5 per cent. and that the change which took effect in March 2002 may have further increased aggregate funding levels against the MFR by around 3 per cent.

1 These estimates are based on MFR data collected from the actuarial profession from consulting actuaries and insurance companies on the MFR funding levels of a sample of just over 1,000 schemes that had an MFR valuation with an effective date between April 1997 and April 2000. The sample may under-represent certain types of schemes, for example smaller schemes. These data have been broadly adjusted to reflect economic conditions in June 2003 using assumptions about the investment policies of the schemes involved.

Mr. Key

To ask the Secretary of State for Work and Pensions if he will list, for each constituency in Wiltshire(a) the numbers of pensioners aged 80 and over in receipt of state pensions and (b) the total number in receipt of state pensions; and what percentage of the total number pensioners aged 80 and over represent. [120983]

Malcolm Wicks

Pursuant to my written answer of 30 June 2003,Official Report, columns 85-86W.

The information is not available in the format requested. Such information as is available is shown in the table:

State Pension recipients aged 80 and over as at 30 September 2002
Thousand
Total number of State Pension recipients aged 80 and over Total number of State Pension recipients Percentage of those over 80 in receipt of State Pension
North Wiltshire 4.2 17.5 24.0
Salisbury 5.6 20.5 27.3
North Swindon 2.4 12.5 19.2
South Swindon 3.1 15.9 19.7
Westbury 5.3 21.2 24.9
Devizes 4.4 19.5 22.7

Note:

  1. 1. Numbers are rounded to the nearest hundred and are expressed in thousands.
  2. 2. Numbers are based on 5 per cent, sample, and are therefore subject to a degree of sampling variation.
  3. 3. Parliamentary Constituencies are allocated using the relevant Office for National Statistics postcode directory.

Source:

Pensions Strategy Computer System as at 30 September 2002.

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