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17 December 2007
COMMENT BY ANN ABRAHAM, PARLIAMENTARY AND HEALTH SERVICE OMBUDSMAN ON OCCUPATIONAL PENSIONS ANNOUNCEMENT
“The principal recommendation I made in my March 2006 report concerning Government bodies and the security of final salary occupational pension schemes, Trusting in the Pensions Promise, was that the Government should consider whether it should make arrangements for the restoration of the core pension and non-core benefits of those who had lost some or all of their promised pension due to the winding-up of their pension scheme.
The Department for Work and Pensions has today announced the results of the consideration that it has given to this issue. Significant extensions to the Financial Assistance Scheme are to be made as a result.
These proposals will give to all those who lost their pensions through no fault of their own, including members of solvent employer schemes, benefits that are broadly equivalent to those available under the Pension Protection Fund – including a guaranteed 90% of their accrued pension, indexation, payment from scheme pension age (rather than state retirement age), and the ability to commute some portion of a pension to a tax-free lump sum.
I warmly welcome this announcement, which constitutes full compliance with my key recommendation and which also remedies the deficiencies in the Financial Assistance Scheme identified in my report.”
Contacts: Philip Aylett 0207 217 4225 philip.aylett@ombudsman.org.uk
Lucy Morrison 0207 217 4064 lucy.morrison@ombudsman.org.uk
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