House of Commons Hansard Written Answers for 14 Jan 2004 (pt 23)

14 Jan 2004 : Column 814W—continued

Public Sector Pensions

Mr. Laxton: To ask the Chancellor of the Exchequer what assessment his Department has made of the level of pension liabilities in the public sector due to final salary pension schemes. [147766]

Ruth Kelly: The level of unfunded pension liabilities are published in the Resource Accounts of the separate schemes. The latest aggregate estimate, based on the 2001–02 accounts, is of accrued liabilities of £380 billion as at 31 March 2002. The figure will be updated when the 2002–03 Resource Accounts are published shortly.

It does not include the liabilities of the funded Local Government Pension Scheme (LGPS). The latest estimate of their liabilities were set out on 17 March

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2003, Official Report, column 614W. It also does not include the funded liabilities of schemes in the wider public sector run by statutory corporations. Information on these schemes are not held centrally and the responsibility for them rests with the relevant sponsoring Departments.

Mr. Laxton: To ask the Chancellor of the Exchequer what steps his Department is taking to reduce the public sector pensions liabilities caused by final salary pension schemes. [147767]

Mr. Boateng: Public service pension schemes are reviewed regularly to ensure that the benefits represent value for money and continue to contribute to the overall aim of the remuneration package to recruit, retain and motivate staff. As part of this process the Government recently announced its decision to raise the normal pension age of public servants from 60 to 65 in the Green Paper "Action on Occupational Pensions" Cm 5835, June 2003. Schemes are consulting on how this might be achieved.

The pension liabilities arising from rights accrued to date cannot be adjusted: the private sector is protected by section 67 of the Pensions Scheme Act 1995 and the public services by the Superannuation Act 1972.

Small Incorporated Businesses

Mr. Jack: To ask the Chancellor of the Exchequer (1) what studies he has undertaken to determine whether small incorporated businesses are paying the wrong amounts of tax on profits extracted from their companies; [147055]

(a)

(b)

(3) if he will make a statement on his proposals to ensure that the right amount of tax is paid by owner managers of small incorporated businesses on the profits extracted from their companies; [147056]

(4) if he will define (a) profit extraction and (b) acceptable profit extraction for small incorporated businesses; [147057]

(5) if he will consult small owner managed incorporated businesses on his proposals to ensure that their tax contributions are correct in the light of the contents of paragraph 5.91 of Command Paper 6042; [147082]

(6) whether it is his Department's policy to encourage sole traders or partnerships to become small limited companies; [147083]

(7) whether his proposals in paragraph 5.91 of Command Paper 6042 will include measures to help small incorporated businesses to unincorporated; [147084]

(8) whether the right amount of tax referred to in paragraph 5.91 of Command Paper 6042 includes National Insurance. [147086]

Dawn Primarolo: The Government have introduced a number of measures to support unincorporated businesses, including cutting the basic rate of income

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tax, the introduction of the 10p starting rate of income tax, permanent 40 per cent. first year capital allowances and the introduction of the VAT flat rate scheme.

Paragraph 5.91 of the 2003 Pre-Budget Report (Command Paper 6042) announced that the Government would bring forward proposals, to ensure that the right amount of tax is paid by owner managers of small incorporated businesses on the profits received from their company, protecting the benefits of low tax rates for the majority of small businesses.

The appropriate details and definitions will be set out in the Budget Report.

Mr. Jack: To ask the Chancellor of the Exchequer how many owner managed small incorporated businesses pay tax. [147058]

Dawn Primarolo: There is currently no precise definition within current tax legislation of 'owner manager'. This issue is among those being considered by the Government in the context of its announcement in paragraph 5.91 of the 2003 Pre-Budget Report.

Tax Credits

Mr. Webb: To ask the Chancellor of the Exchequer how many child and working tax credit recipients have reported changes in circumstances since being informed of their initial award. [146763]

Dawn Primarolo [holding answer 12 January 2004]: Information is not available in the form requested.

UK Company Profitability

Mr. Stephen O'Brien: To ask the Chancellor of the Exchequer (1) what the profitability of UK companies with a turnover of (a) less than £1 million, (b) £1–20 million, (c) £20–50 million, (d) £50–100 million and (e) more than £100 million has been in each quarter since 1997; [148180]

(a)

(b)

(c)

(d)

(e)

(f)

Ruth Kelly: The information requested falls within the responsibility of the National Statistician, who has been asked to reply.

Letter from Mr. Colin Mowl to Mr. Stephen O'Brien, dated 14 January 2004:

The National Statistician has been asked to reply to your Parliamentary Questions on profitability of UK companies by turnover and also by number of employees. I am replying in his absence. (148180, 148181)

Unfortunately the Office for National Statistics (ONS) do not produce statistics on profitability of UK companies by turnover or by number of employees. The ONS does produce a quarterly First Release called the Profitability of UK Companies, which is available on the ONS website at: http://www.statistics.gov.uk/pdfdir/profit0104.pdf

The Release shows the profitability of all UK companies and also for United Kingdom continental shelf companies, manufacturing companies and service companies. The profits data used in calculating these estimates comes from a relatively small sample inquiry of companies. The sample is too small to enable us to produce estimates in the detail requested.