Pension Liabilities: Plumbing Industry

Oral Answers to Questions — Work and Pensions – in the House of Commons on 1st July 2019.

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Photo of John Mann John Mann Chair, Treasury Sub-Committee

What recent discussions she has had with representatives from the plumbing industry on section 75 pension liabilities.

Photo of Guy Opperman Guy Opperman The Parliamentary Under-Secretary of State for Work and Pensions

I met plumbing representatives from Lancashire recently, and those in Angus and Perth last year. We also debated this matter in the House last year. There are nearly 1,000 last man standing multi-employer schemes. Most respondents to the Green Paper on defined-benefit pensions felt that the current buy-out basis was a clear and fair way in which to calculate an employer debt.

Photo of John Mann John Mann Chair, Treasury Sub-Committee

My constituent Margaret Briggs, having paid £21,000 over 11 years with four employees into a pension scheme, has in the past four weeks received a demand for £331,000. How is she expected to pay this, and how can that possibly be rational and fair?

Photo of Guy Opperman Guy Opperman The Parliamentary Under-Secretary of State for Work and Pensions

I cannot speak on the specifics of the individual scheme, but the majority of the employers in these schemes are incorporated and are not personally liable for any debt. The flexible apportionment arrangement can be used to help unincorporated employers who wish to incorporate, and the plumbing pension trustee has a streamlined flexible apportionment arrangement process that employers can use. Alternatively, where the employer debt arises in multi-employer schemes as a result of an employer cessation event, there are a number of mechanisms in the occupational pension schemes employer debt regulations that can be of assistance