|Previous Section||Index||Home Page|
Margaret Moran: To ask the Chancellor of the Exchequer what guidance he has issued to Government Departments on the advertisement of procurement contracts on the website for www.supply2.gov.uk; and which (a) Departments and (b) agencies use the website. 
Ian Pearson: BERR and HMT Ministers wrote jointly to all Departments in April 2008 to reiterate the Governments commitment to advertise procurement opportunities below the EU procurement thresholds on the www.supply2.gov.uk site. An event for departmental procurement officials in June 2008 was also held to raise awareness.
Department for Children, Schools and Families
Department for Environment, Food and Rural Affairs
Home Office/Ministry of Justice
Department for Business, Enterprise and Regulatory Reform
Department for Transport
Department for Work and Pensions
Crown Prosecution Service
To ask the Chancellor of the Exchequer what estimate he has made of the quantity of (a) index-linked and (b) conventional gilts planned to be auctioned by the Debt Management Office (DMO) in
each of the next 12 months; what discussions he has had with the DMO on such auctions; and if he will make a statement. 
Ian Pearson: In 2009-10 the Government plan to issue £127.2 and £20.7 billion in conventional and index-linked gilts respectively. Further details of the Governments provisional financing plans can be found in the provisional debt management report 2009-10. HM Treasury and the Debt Management Office worked together in the formulation of these plans, following usual practice. In line with updated fiscal forecast due to be published in Budget 2009, new issuance plans will be presented in the debt and reserves management report 2009-10 to be published alongside the Budget.
Mr. Amess: To ask the Chancellor of the Exchequer how much was received from auction of (a) index-linked and (b) conventional gilts by the Debt Management Office in each of the last 12 months. 
Ian Pearson: The Debt Management Office raised £146.5 billion (cash) through 58 auctions and eight mini-tenders in 2008-09. This total was split between £126.7 and £19.7 billion in conventional and index-linked gilts respectively. The monthly breakdown is provided in the following table:
Mr. Sheerman: To ask the Chancellor of the Exchequer if he will take steps to relax the restriction on assets held by Kaupthing Singer and Friedlander (Isle of Man) to allow that institution to make further refunds to its UK depositors. 
Ian Pearson: Kaupthing Singer and Friedlander, Isle of Man, (KSF IoM) is not a subsidiary of Kaupthing Singer and Friedlander in the UK (KSF UK), but of the Icelandic parent company. KSF IoM is however a creditor of KSF UK.
KSF IoM is currently in provisional liquidation. KSF UK is in administration and there is a moratorium in place on the enforcement of all creditor claims. It is for the administrators of KSF UK in the first instance to determine whether it is appropriate to make a payment to any creditor. Under UK insolvency law, KSF IoM ranks like any other creditor of KSF.
Harry Cohen: To ask the Chancellor of the Exchequer what estimate he has made of the amount of financial liability which has been assumed by the Exchequer as a result of the recent Lloyds TSB rescue package; and what assessment he has made of the implications of the package for the Government's policy on moral hazard. 
Ian Pearson: Lloyds Banking Group (Lloyds) announced on 7 March their intention to participate in the asset protection scheme. Lloyds intends to protect £260 billion of eligible assets. Lloyds will pay a participation fee of £15.6 billion to the Treasury in capital.
The agreement will mean that in the event of a loss, Lloyds will bear a first loss amount after existing impairments of up to £25 billion. Thereafter, losses will be borne 90 per cent. by the Treasury and 10 per cent. by Lloyds.
The long-term impact on the public finances will be determined not by the value of the assets covered but by any net loss once fees, first losses, and recoveries are taken into account. It is impossible to set out costs for certain at this point. The scheme is designed in part to provide protection for assets that the market cannot value. HMT will keep 90 per cent. of recoveries until all the payments made by HMT have been reimbursed. The Governments investments will be held for no longer than is necessary to ensure stability and protect taxpayer interests.
Mr. Amess: To ask the Chancellor of the Exchequer what plans he has to adjust the level of the supply of money he plans for the next 12 months; what discussions he has had with the Governor of the Bank of England on this since January 2009; and if he will make a statement. 
Ian Pearson: Decisions on the value of assets to be purchased using the creation of central bank reserves are a matter for the Monetary Policy Committee of the Bank of England. In a letter to the Governor of the Bank of England on 3 March 2009, the Chancellor authorised up to £150 billion of purchases: this is the maximum limit within which the MPC will determine the scale of its purchases each month.
Richard Burden: To ask the Chancellor of the Exchequer what consideration he has given to the merits of tax flexibility to assist companies in the automotive sector in dealing with the effects of the economic downturn. 
Mr. Timms: As part of a substantial package of support to help businesses deal with the effects of the economic downturn, the Chancellor announced in PBR 2008 that HMRC had introduced a new Business Payment Support Service. Businesses, across all parts of the economy, in temporary financial difficulty can spread their HMRC tax bill over a timetable they can afford. This has already helped over 4,900 firms in the automotive industry.
The Government have also announced that the Automotive Assistance Programme is now open for business. A seminar was held on 11 March to inform companies, banks and industry representatives about applying for help.
Mr. Timms: The National Insurance system operates on a pay as you go basis with the contributions that people pay now funding contributory benefits currently in payment and helping to fund the NHS. There are time limits for paying all Classes of contributions including Class 3 contributions. These are intended to prevent contributors from delaying payment of their contributions until they come to make their claims for benefit or pension entitlement.
The Government believe that the time limits for paying Class 3 contributions provide sufficient flexibility, and has no further plans to change them. The Government introduced changes in the Pensions Act 2008 to allow people, who reach State Pension age between 6 April 2008 and 5 April 2015 and already have 20 qualifying years, the opportunity to pay up to an additional six years of Class 3 contributions outside the most recent six tax years.
If the limits were to be extended or abolished the weekly rate of Class 3 contributions would have to be increased substantially as contributors could delay making payment until shortly before they started drawing their state pension.
Mr. Philip Hammond: To ask the Chancellor of the Exchequer how much of the projected expenditure on public sector pensions shown in table 4.1 of the Long-term Public Finance Report he expects will be financed from employee contributions. 
Yvette Cooper: As with all defined benefit pension schemes, regular actuarial valuations ensure that employees and employers pay a contribution rate appropriate to the level of expected benefits. Following Government reforms, major schemes have capped the employer contributions which will control taxpayers exposure to future cost pressures. In terms of financing the current pensions in payment, as with all Pay-As-You-Go schemes, current employee contributions are used to finance these pensions. The assumptions used in producing table 4.1 will be published in due course.
Mr. Philip Hammond: To ask the Chancellor of the Exchequer which public sector pension schemes (a) liabilities are included in box 4.3 and (b) expenditure is included in the projections in table 4.1 of the 2008 Long-term Public Finance Report. 
Yvette Cooper: I refer the hon. Member to the answer I gave him on 26 November 2008, Official Report, column 1911W, the same public service occupational pension schemes are used in producing box 4.3 and table 4.1 of the Long Term Public Finance Report 2008
Mr. Philip Hammond: To ask the Chancellor of the Exchequer (1) what the (a) start and (b) end date of the 50-year period is over which he estimated that reforms to the Civil Service, NHS and teachers pension schemes would save £13 billion; 
(3) if he will estimate the net present value of savings made by reforms to (a) the Police Pension Scheme, (b) the Armed Forces Pension Scheme and (c) the Firefighters Pension Scheme on the same basis as he estimated that reforms to the Civil Service, NHS and teachers pension schemes would save £13 billion over 50 years; 
(4) with reference to the Answer to the hon. Member for Yeovil of 31 October 2006, Official Report, column 317W, on public sector pensions, how he calculated the net present value of savings over a 50-year period without first estimating the savings that would be achieved in each year; 
(5) whether his estimate that reforms to the Civil Service, NHS and teachers pension schemes would deliver savings with a net present value of £13 billion over 50 years is expressed in 2008 prices; 
(6) what assumptions he has made about the dates of commencement of reforms to the Civil Service, NHS and teachers pension schemes; when he made his estimate that such reforms would save £13 billion over a 50-year period; and if he will revise his estimate on the basis of the dates on which the reforms took effect; 
(7) what account his estimate of a £13 billion saving from reforms to the Civil Service, NHS and teachers pension schemes takes of (a) the net present value of cashflow savings on benefits paid out net of employee contributions paid in during the 50-year period and (b) the net present value of the reduction in the value of benefits accrued relative to employee contributions paid during the 50-year period; what other factors his estimate takes into account; and if he will make a statement. 
Yvette Cooper: To assist discussions of modernisation reforms to the pension schemes for the NHS, teachers and civil service in 2005, an indicative estimate of £13 billion was calculated as the potential net saving in employer costs for these three schemes over a 50-year period from 2006. The estimates were based on approximate methodologies to indicate the savings that might result from the proposals then under discussion and were heavily rounded to allow for factors such as the possibility of a few years variation in start dates.
The estimate was calculated as at 2005, using 2005-06 prices, to show the amount of employer contribution savings over a 50-year period, converted to a capitalised value. This reflected savings in the value of benefits built up over the 50-year period, not cashflow savings on benefits paid out over that period. The estimate took into account expected membership of the pension schemes and a net discount rate of 3.5 per cent. per annum in excess of prices.
The subsequent packages that were actually introduced included further reforms, such as cost sharing and cost capping mechanisms, to limit employer costs. The £13 billion calculations are now obsolete and revised estimates of the capitalised savings and extensions of the estimates to other schemes on the assumptions used in 2005 could be provided only at disproportionate cost. Instead, the significant level of savings that are already being delivered by the scheme reforms were described in my answer to the hon. Member of 26 November 2008, Official Report, column 1909W.
Mr. Philip Hammond: To ask the Chancellor of the Exchequer (1) what changes to the number of active members in (a) the NHS Pension Scheme, (b) the Teachers' Pension Scheme, (c) the Principal Civil Service Pension Scheme, (d) the Armed Forces Pension Scheme and (e) the Police Pension Scheme are assumed to take place over the projection period shown in table 4.1 of the 2008 Long-term Public Finance Report; 
(2) what assumed mortality rates for members of public sector pension schemes were used to calculate the figures in table 4.1 of the 2008 Long-term Public Finance Report; and whether these differ from the assumed rates underpinning population projections; 
(3) what average life expectancy was assumed for (a) male and (b) female members of the (i) NHS Pension Scheme, (ii) Teachers' Pension Scheme, (iii) Principal Civil Servants Pension Scheme and (iv) Armed Forces Pension Scheme aged 65 in (A) 2007, (B) 2017, (C) 2027, (D) 2037, (E) 2047 and (F) 2057 in calculating the figures in table 4.1 of the March 2008 Long-term Public Finance Report; 
|Next Section||Index||Home Page|