§ Mr. Tony ColmanTo ask the Secretary of State for the Environment, Transport and the Regions when he intends to issue new regulations to govern the local government pension scheme in England and Wales; and if he will make a statement. [6495]
§ Ms ArmstrongI have placed in the Library of the House today new regulations for the local government pension scheme (the LGPS) to apply in both England and Wales with effect from 1 April 1998. They provide less central control of pension arrangements, increase the scope of local decision-taking and offer improved flexibility in pension provision.
The Local Government Pension Scheme Regulations 1997 are the product of careful preparation, consultation and discussion with many interested parties. They provide a modernised legal framework and give local government employers greater scope to manage pension scheme benefits. They offer new pension flexibility to both employers and employees while continuing to provide secure, statutory-based pensions for all scheme members and pensioners. Employers will be able to offer members a shared-cost additional voluntary contributions arrangement to improve their pensions. Improved death benefits and spouses pensions have been added to the scheme's benefit package and new options have been added to allow employers and employees greater scope in the provision of retirement benefits, including new criteria to decide when pension benefits may be paid early. New standardised employees' contribution rates, to apply from 1 April 1998, are also included in the package.
The improved regulations ensure that the scheme provides the right qualities and benefits to meet the pension needs of local government employees and pensioners into the next century. The new regulations create a more accountable administrative and benefit framework for local authority employers who are responsible for the scheme's day to day management. They also provide a basis for considering with all the interested parties further scheme developments.
To allow scheme managers and other interested parties sufficient time to adapt their existing policy and administrative procedures to the new arrangements, the regulations come into force on 1 April 1998. My Department's Local Government Pensions Unit will continue to work closely with the interested parties to explain the purpose and operation of the regulations and to monitor their effectiveness. The unit is producing guidance material for scheme members to explain the new provisions and assisting the United Kingdom Steering Committee on Local Government Pensions in the production of explanatory material for local authority employers and other LGPS users.
New regulations governing transitional arrangements to protect the benefit rights for existing scheme members and draft proposals for the management and investment of local authority pension funds will be issued shortly.