§ Mr. HopeTo ask the Secretary of State for Social Security if he will make a statement on the compensation and general levies payable under the Pension Schemes Act 1993 by occupational and personal pension schemes. [114334]
§ Mr. RookerI am pleased to announce that the rate of the Compensation Levy will remain unchanged at a maximum of 23 pence per member for the third year in a row and that it will not be necessary to raise a Compensation Levy in 2000–01.
Regulations are being laid today for the General Levy that will increase rates for most pension schemes from 1 April 2000 with the exception of occupational schemes with 6,604 or more members. Rates for these schemes have been frozen at their present levels for the coming year. The rates for 2000–01 are shown in the table.
The General Levy covers the costs of the bodies that safeguard the rights of pension scheme members or provide them with help, advice and information. These bodies are the Occupational Pensions Regulatory Authority (Opra), the Pensions Ombudsman, the Pensions Advisory Service and the Pension Schemes Registry. It is essential that these bodies have the resources necessary to meet their continuing and new responsibilities so that all scheme members' interests are properly protected.
The increase in the General Levy rates for most, but not all, occupational pension schemes reflects that the biggest schemes generate little work for Opra, and have not contributed to the steady increase in the number of cases referred to them or to the complexity of the issues with which they deal. The new rates for personal pension 802W schemes reflect that Opra's regulatory functions are extended to those schemes and to Stakeholder pension schemes by the Welfare Reform and Pensions Act 1999.
General Levy rates 2000–01 Scheme size (Number of members) Basis Amount per member (£) Minimum payment per scheme1 (£) >Occupation Pension Schemes 2 to 11 £12 per scheme — — 12 to 99 Per member 1.25 — 100 to 999 Per member 0.90 125 1,000 to 4,999 Per member 0.70 900 5,000 to 9,999 Per member 0.53 3,500 10,000 or more Per member 0.37 5,300 Personal Pension Schemes 2 to 11 £5.20 per scheme — — 12 to 99 Per member 0.50 — 100 to 999 Per member 0.35 50 1,000 to 4,999 Per member 0.30 350 5,000 to 9,999 Per member 0.20 1,500 10,000 or more Per member 0.15 2,000 1 Minimum payments ensure that schemes in the lower bands do not pay more overall than those in the higher bands.
§ Angela SmithTo ask the Secretary of State for Social Security what plans he has to consult on draft regulations on employer payments to personal pensions and stakeholder pensions. [114332]
§ Mr. RookerWe are today issuing a consultation document containing draft regulations on employer payments to personal pensions and stakeholder pensions.
The new requirements represent a major change for both insurance companies and employers. The consultation document contains a full description of the new arrangements. We want to alert employers and insurance companies now so that they can start planning for the new regime, which we plan to bring into force in April 2001.
An important part of our pension reforms is that people should have greater confidence in private pensions. Regulations require deductions from pay to be paid by employers to occupational pension schemes within set deadlines. Today's draft regulations extend this requirement to personal pensions and stakeholder pensions.