§ Mr. Michael Lathamasked the Chancellor of the Exchequer if he will specify the reasons why the Government are not prepared to raise the salary limit of £5,000 per annum above which refund of occupational pensions is prohibited; when this level was fixed; and what the limit would be to the latest convenient date if it had been raised to keep pace with inflation.
§ Mr. Robert Sheldon,pursuant to his reply [Official Report, 14th July 1975; Vol. 895, c. 348.], gave the following information:
I presume the hon. Gentleman's Question refers to refunds of pension contributions. The £5,000 limit to which he refers was fixed in 1970; on the basis of the change in the retail prices index since then an equivalent figure now would be about £8,000. It is Government policy to encourage the preservation of pension rights. In this context it would be inconsistent to relax the restraints on refunds of contributions for tax approval purposes at a time when those restraints are being strengthened through the Social Security Act 1973, one of the provisions of which, when fully effective, will bar refunds of contributions except in the case of certain young people and those with only short services.