Clause 141 - Valuations to determine scheme underfunding

Pensions Bill – in a Public Bill Committee at 2:30 pm on 1st April 2004.

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Question proposed, That the clause stand part of the Bill.

Photo of Malcolm Wicks Malcolm Wicks Minister for pensions, Department for Work and Pensions

It might be useful if I put on record the fact that clause 141 sets out the requirement for schemes to provide a valuation of their assets and protected liabilities in order to determine the level of underfunding.

For the purposes of establishing a scheme's level of funding to allow the board to take account of funding levels in the risk-based pension protection levies, they will be subject to a PPF-style evaluation. That valuation will provide information on the financial state of eligible schemes that are required to pay the levy. That will help the board to determine the amount of the risk-based levy due from schemes.

We expect that valuation to be conducted in tandem with schemes' normal triennial valuations to ensure that additional financial burdens are not placed on employers or trustees. As I said, however, a scheme that feels that it would benefit from a lower risk-based element by bringing forwards its triennial valuation would be free to do so.

Question put and agreed to.