§ Mr. FieldTo ask the Secretary of State for Social Security if he will set out his Department's policy in relation to the application of a cap on rebates to appropriate personal pensions from 2002 onwards. [159396]
§ Mr. RookerAge-related rebates to appropriate personal pensions are capped for two reasons. First, the cap restricts the cost to public funds. Secondly, the cap also discourages those approaching pensionable age from making what could be inappropriate pension arrangements, given the short amount of time they would have to benefit from investment growth in a money purchase scheme.
We have increased the cap which will apply to age-related rebates in respect of earnings from April 2002, so that all those who are currently unaffected by the cap (that is those who will be up to age 50 in April 2002) will remain unaffected by it.