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Written Ministerial Statements

Thursday 11 December 2003


Police Pension Scheme

The Secretary of State for the Home Department (Mr. David Blunkett): I have today published a consultation paper which sets out proposals for a new police pension scheme for future entrants. We intend that the new scheme should be in place by no later than April 2006.

The aim is to produce a modernised, more flexible scheme for a twenty first century police service. The proposed new scheme would include benefits such as a full pension of half final salary plus a lump sum of four times' pension after 35 years, life-long survivor benefits extended to unmarried and same sex partners as well as spouses, and a lower contribution rate of between 9 to 9.5 per cent. of pensionable pay. In line with Government policy on pension ages in future the new scheme would have a minimum pension age of 55 and a deferred pension age of 65 for those leaving the service before the age of 55.

Currently serving officers who are in the existing scheme will remain there unless they opt to transfer to the new scheme. As members of the current scheme they will still be able to retire after 25 or more years' service with a pension age unaffected by the proposed changes. However, younger serving officers who leave the service early might be affected by Government proposals to apply the planned rise in the normal public service pension age from 60 to 65 to some existing staff. Any future move to raise the deferred pension age of currently serving officers to 65 would not be made before there had been a full debate about how this might be implemented across the public sector, and would apply only to pensionable service falling after the date of change.

Government plans to raise the minimum pension age to 55 in April 2005 will not affect currently serving officers who continue in service until retirement under the present police pensions scheme. However, the consultation document discusses the arrangements that should be made for officers who enter the service between April 2005 and the start date of the new scheme, if such a time lag occurs.

The consultation document also sets out Government plans for reforming the system of financing police pensions with a view to making expenditure on paying pensions to retired officers more predictable and more clearly separated from operational costs.

We seek a well-informed and constructive debate on the proposed elements of a new scheme for future entrants to the police service before we come to our final decision on how to take police pensions forward into the twenty-first century.

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Copies of the consultation document are available in the House library and on the Home Office web-site www.homeoffice.gov.uk/ Comments have been requested by 11 March 2004.

Community Capacity Building

The Parliamentary Under-Secretary of State for the Home Department (Fiona Mactaggart): A Home Office consultation document on the Review of support for community groups and community capacity building in England is being published online today. The consultation document outlines the results of the review on mapping existing Government activity in the field of community capacity building and makes proposals for change. The consultation document asks questions to inform how Government might take forward actions to implement change.

The Government aim is to unify and make more effective the planning, resourcing and evaluating of provision for building the capacity of individuals and groups in communities to participate in community activity and contribute to a wide range of social objectives.

The review focused on two main areas, and the proposals for change outlined in the consultation document relate to the:

Copies of the consultation document are available in the House Library and on the Home Office http://www.homeoffice.gov.uk/docs2/ccbrconsult.pdf website. We would welcome views on the proposals and questions outlined in the consultation document.

A partial regulatory impact assessment is included with the consultation document.

Voluntary/Community Sector

The Secretary of State for the Home Department (Mr. David Blunkett): I am pleased to announce that arrangements for the implementation of the futurebuilders fund for voluntary and community sector have now been completed. The fund will be transferred to the active communities unit in the Home Office from HM Treasury. Futurebuilders is a £125 million investment over three years, mainly for one-off investment funding. We expect funding to come on stream towards the end of this financial year. The vast majority of the funds will be available in the next two financial years. The availability of funding will be publicised and organisations will be able to apply.

The fund will be aimed at helping individual voluntary and community sector organisations strengthen the scale and scope of their contribution to the delivery of public services. This fund complements the £80 million already being made available to support the implementation of a strategy for the development and support of voluntary and community organisations being jointly developed by government and the sector.

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Over £200 million is therefore being invested between now and 2006 to building capacity within communities.

This fits with our wider strategy to promote and develop volunteering and mentoring for all ages. We will shortly be investing funding in a number of volunteering initiatives including work with older volunteers.

This will strengthen our communities and help ensure that they are better able to shape and deliver the services they need and to engage in volunteering and mentoring.


Parliamentary Pay and Allowances

The Leader of the House of Commons (Mr. Peter Hain): In 1996 the Senior Salaries Review Body recommended that Parliamentary pay and allowances should be reviewed every three years, commencing in 2000. In line with this recommendation my right hon. Friend, the Prime Minister has recently written to John Baker, the Chairman of the Senior Salaries Review Body asking the body to report next year.



The Secretary of State for Trade and Industry (Ms Patricia Hewitt): In July this year, I announced that DTI and BNFL would conduct a joint review of the company's future strategy, and that recommendations would be made to the BNFL Board and Ministers in the Autumn.

It was decided that a review was necessary to evaluate alternative strategies, following on from the decision to rule out a flotation of the company after the Nuclear Decommissioning Authority had been formed in April 2005. The review has been conducted against the framework of the Government's policy objectives set out in the White Paper "Managing the Nuclear Legacy—a Strategy for Action" and in particular the need to develop a competitive market for nuclear site management. It has been driven by the Government's overriding priority to ensure safe, efficient and effective clean-up at Sellafield and other civil nuclear sites. One of the key objectives of the review was to focus BNFL's activities more closely on the priority of UK clean-up.

As announced in the White Paper, the NDA will take over strategic responsibility for the discharge of BNFL's UK nuclear liabilities from April 2005, subject to Parliamentary approval of the Energy Bill. A new parent company will be established at that point to hold those parts of BNFL that will not become the NDA's responsibility.

The Government does not intend that the new parent company and its holdings will be privatised as a whole by flotation. We have also agreed that the sale of the entire group as an integrated structure is not an objective. However, proposals for involving the private sector in individual businesses will be examined on their merits, consistent with the Government's overall objectives of focusing on a more competitive market in UK clean-up, maximising the value and limiting the risk

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of BNFL's businesses to taxpayers; while ensuring that safety, security and environmental standards are maintained.

Other key conclusions are :

In the period up to the establishment of the NDA in April 2005, BNFL and its Board will continue to have responsibility for the safe and efficient running of its existing sites and for the financial performance of the company and its subsidiaries.

At the same time as a new parent company is established in April 2005, a new group of subsidiary companies will be established which will have initial responsibility for managing clean-up and operations at BNFL's UK sites under transitional arrangements to be agreed with the NDA. These companies will have the chance to bid to continue managing these sites when the NDA introduces competition.

Fuel manufacture will continue at the Springfields site, where clean-up activity is also underway. It will be established as a separate licensed entity, likely to be managed initially by Westinghouse, and with the NDA taking financial responsibility for the relevant decommissioning and clean-up liabilities.

The vast majority of the existing BNFL UK workforce will continue to be employed by companies that operate current BNFL sites. Initially, the two largest site licensee companies will be British Nuclear Fuels plc (which will continue to have the licence for the Sellafield site) and Magnox Electric plc. Other employees will transfer into companies within the clean-up group.

BNFL's existing Research and Technology facilities and a proportion of the personnel will remain with the site licensee companies. Other staff will transfer to a new Nuclear Science and Technology Service (NSTS) which will initially be a subsidiary of the new parent company and will deliver services on a commercial basis to the NDA, site licensee companies and third parties. These proposed arrangements for R&T are consistent with the Government's policy to keep the nuclear option open as set out in the White Paper "Our Energy Future—creating a low carbon economy".

The BNFL Board, and from April 2005, the Board of the new parent company will manage the other businesses to deliver value and in a way that limits and controls risk to the UK taxpayer.

In relation to the Westinghouse business, the Government has agreed with the BNFL Board that steps will be taken to enable the business to operate with greater financial independence from its parent, so that possibilities for private sector participation are opened up.

Future strategy for the investment in the Urenco fuel enrichment business will take full account of the strategic significance of this business and of the UK's nuclear non-proliferation obligations.

BNFL is seeking routes to reduce significantly its exposure to the US clean-up market.

These proposals are designed to help deliver the policy objectives set out in the 2002 White Paper "Managing the Nuclear Legacy" and are entirely

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consistent with our continuing commitment to keep the nuclear option open as set out in the 2003 Energy White Paper. They offer the best route towards both a more competitive market for UK clean-up, better value for taxpayers and a genuine opportunity for BNFL staff and management to continue to play a key role in meeting the challenge of nuclear clean-up.

We are also very conscious of the need to consider the impact of the NDA proposals and BNFL's future strategy on local communities. This is why the legislation to establish the NDA will facilitate its involvement in social and economic activities to support them.

We have sought to maximise the benefits from the establishment of the NDA to West Cumbria, for example:

I am placing further details of the review outcome in the Library of the House.

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