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Government response to FAS consultation
29 April 2008
Today the Government published its response to the consultation on the draft Financial Assistance Scheme (Miscellaneous Provisions) Regulations 2008. The Government is very grateful for the comments received. A final draft of the Regulations was also laid before Parliament today with a view to them coming into force by the end of May, subject to Parliamentary approval.
You can read the draft
regulations (43KB) 
and
the consultation
response (63KB) .
Announcement of FAS Consultation - A Ministerial Statement from Mike O'Brien, The Minister for Pension Reform
27 March 2008
The Minister for Pension Reform, Mike O’Brien in a statement (24KB) today
announced the publication tomorrow (28 March 2008) of draft regulations
and a consultation document in support of the second stage of delivering the
commitments made by Government in December 2007 regarding the extension to
the Financial Assistance Scheme (FAS). These draft regulations will:
- allow early payment for those members unable to work due to ill health;
- extend the FAS to members of schemes which wound up under-funded with a solvent employer;
- speed up initial payments;
- allow the PPF to be more closely involved in developing and managing the new FAS arrangements;
- allow the scheme manager to direct trustees in order to ensure that any reduction in the scheme's assets is kept to a minimum; and
- remove the option to apply for reinstatement into the State Additional Pension for those eligible for FAS.
You can read the Financial
Assistance Scheme (Miscellaneous Amendments) Regulations 2008 (357KB) consultation
document.
In order to bring in the improvements to the FAS as soon as possible the Government has decided on a shorter than usual consultation period of 6 weeks – the consultation period will close on 9 May 2008.
First Solvent Schemes taken into FAS
11 March 2008
The Financial Assistance Scheme has released information on the First Solvent Schemes to qualify for assistance.
Announcement of FAS Consultations - A Ministerial Statement from Mike O'Brien, The Minister for Pension Reform
6 March 2008
The Minister for Pension Reform, Mike O’Brien issued a statement (19KB) today to outline the next steps to delivering the commitments made by Government in December 2007 regarding the extension to the Financial Assistance Scheme (FAS). The key messages from his statement are;
- Draft regulations that will allow FAS to make payments at 90% of accrued pension from scheme normal retirement age, have been issued today for a two week written consultation period.
- A consultation paper has also been issued on proposed changes to the annuity factors used by FAS when converting cash sums into annual rates of pension.
- Proposals to remove access to Deemed Buyback into the state pension for qualifying FAS schemes.
You can read the full Consultation documents for the
draft Financial Assistance Scheme (Miscellaneous Provisions) Regulations
2008 (153KB) and
the Revision
of the annuity factors employed by the Financial Assistance Scheme (193KB) .
FAS Review of Scheme Assets – statement from Secretary of State Peter Hain
17 December 2007
The Rt Hon Peter Hain MP, Secretary of State for Work and Pensions, made the following statement (56KB) in response to the final report (1.32MB) of the Young review.
FAS Review of Scheme Assets final report
17 December 2007
On 23 April, the Minister of State for Pensions Reform, James Purnell, launched a review to examine whether an alternative treatment of the residual funds in affected pension schemes could supplement the committed Government funding of the Financial Assistance Scheme.
Andrew Young of the Government Actuary’s Department led the review and he was advised by a panel of leading external experts, who provided support across a wide range of specialist and technical areas.
The Review’s final
report (1.32MB) was published on 17 December 2007.
In this final report the Review team look at:
- the value of assets in FAS schemes, their ownership and stewardship;
- potential uses of these assets and whether there are options to increase value;
- simplification of the benefit structure in FAS;
- the costs of FAS;
- other non tax sources of funding; and
- pension schemes that have wound up underfunded with solvent employers.
Financial Assistance Scheme – Review of Cost Estimates
17 December 2007
The
Financial Assistance Scheme – Review of cost estimates report (133KB)
describes:
- Revised estimates of the costs of current levels of FAS assistance as announced in the 2007 Budget,
- The data and modelling improvements from an extensive model-development project involving the DWP, GAD and Pricewaterhouse Coopers (PwC).
Part of the modelling process included validation by Pricewaterhouse Coopers
(PwC) which is described in their validation
report (240KB)
This document also provides cost estimates of the new extension which includes:
- Payment of 90% of expected pension
- Payment from scheme normal retirement age, subject to a lower age limit of 60
- Indexation of assistance relating to post-1997 service
- Extension of FAS to schemes with a solvent employer
This document should be read alongside the final report of the Review of Assets undertaken by Andrew Young, which is published today.