Vote To Increase Pension Compensation Payouts
In what was not a widely unexpected defeat for the government, the Lords have introduced an amendment to the recent Pension Bill demanding an increase in compensation payouts to those who have suffered from the collapse of their company pension schemes. The amendment brings the Financial Assistance Scheme into line with more recent regulations promising to cover 90% of “core†pension entitlements against only 80% for earlier victims.
While the Lords ruling is a moral victory, in practice the amendment will be wiped off the Bill when it returns to the Commons, where the government still enjoy a useful majority. The government have chosen to ignore a raft of rulings and advice from the UK and European Courts requesting that pension victims are more generously compensated, citing financial constraints.
As yet we have seen no real change in pension legislation to protect future victims, and while the politicians continue to argue, the suffering goes on for those caught up in the situation. Campaigners have promised to take their case further, however there is little real hope of success as the government seem to have decided that they will not be increasing the compensation package.
As with so may of today’s pension problems, market observers a blaming the decision in 1997 to introduce further tax liabilities on pension scheme assets - a decision which has had a major impact on the lives of many.
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