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Financial Assistance Scheme (Miscellaneous Amendments) Regulations 2008

My Lords, the draft provisions provide for claims within five years of the normal retirement age. This goes beyond the commitment provided in December 2007 to provide help to members over 60; we have done more than we committed to at the time. This approach ensures that all members who meet the ill-health qualifying conditions have an opportunity to receive early, reduced ill-health payments in the five years before their normal retirement age. As I said, as part of the consultation we invited representations on behalf of any members who are unable to work due to ill health and who are not covered by our extended proposals. The noble Lord, Lord Skelmersdale, asked me about the full buy-out cost. I missed the full import of his question. Perhaps he will take the opportunity to ask it again when I have tried to deal with some of the other points that he raised. The noble Lord, Lord Oakeshott, referred to annuity factors. They are used in the FAS to calculate the amount of annuity a member could have received if they had not taken their share of remaining scheme funds in some other way, such as a transfer value or a lump sum during wind-up. The factors seek to approximate as closely as possible the amount of annuity that the trustees could have purchased under bulk annuity terms for that amount of funds, so they need to be kept under regular review and updated as necessary to ensure that they are broadly in line with market rates. The Government Actuary’s Department recently produced revised draft factors, and we consulted the pensions industry before using them. The noble Lord, Lord Oakeshott, also asked about the Desmond scheme. There are two kinds of situation here. One concerns solvent employers with schemes that are not fully funded, which arise from issues around buy-out arrangements and whether a full buy-out cost had to be applied. These regulations deal with those situations. The Desmond situation is where the employer has become insolvent but the wind-up of the scheme started later than April 2005. We need to deal with that in primary legislation and the relevant provisions are, or will be, in the Bill which we are discussing with great joy. We have identified three schemes in this latter category. Many more schemes were identified in the former category. I cannot put my hands on the relevant figure, but I am happy to write to the noble Lord, if that will help. Both noble Lords asked why the PPF’s provisions could not be adopted more fully sooner. I remind them of the sequence of events. Andrew Young’s report charted the way forward for us. Part of his remit was to look at engagement with the PPF. Greater engagement with the PPF needs to be undertaken to see what expanded role it might undertake. We have given a power for it to provide advice. I hope that I have dealt with everything apart from the full buy-out cost, which the noble Lord raised. I missed the full import of his question. I hope that he will ask it again and I shall see whether I can help.