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Occupational Pensions

I wanted to come to that point, which concerns liability and the denial on the part of Government, in their response to the ombudsman and to the Committee, of all liability in this area. The ombudsman herself explains most effectively why that cannot be right. First, she says,"““Government was responsible for establishing the legal framework governing both the regulation of the occupational pension system and also the funding framework relevant to each individual scheme””." Secondly, she says,"““Government decided to design a system that would provide non-pensioner scheme members with only a 50 per cent. chance of securing their pension contributions if their scheme wound up—and took other policy decisions which directly affected the financial stability of schemes””." Thirdly, she says,"““Government was responsible for approving the actuarial basis of the level at which each scheme had to be funded—and reduced that level twice””." Fourthly, she says,"““Government designed a priority order which over-rode the discretion of trustees to apportion the assets of schemes fairly between all the members of a scheme in wind-up—and gave itself and financial institutions higher priority than pension schemes when the assets of insolvent employers were distributed. Public bodies thus received a proportion of the assets of insolvent companies that was denied to those companies' pension schemes””." And fifthly, she says,"““Government prescribed what trustees had to tell scheme members about their pensions through what were known as the Disclosure Regulations. The Government decided that this should not include issues of risk.””"