FAS move welcomed

21 December 2007 / by None
Department of Work and Pensions secretary Peter Hain's decision to compensate the victims of failed pension schemes has been welcomed by consultants Mercer.

However the company, which also provides outsourcing and investment services, has warned that the decision of who pays will be a difficult one.

About 140,000 people lost pension investments through failed schemes and the Young review has recommended that the government should top up the residual assets, totalling £1.7 billion, under the Financial Assistance Scheme (FAS).

This would bring the amount of compensation in line with that managed by the Pension Protection Fund.

Deborah Cooper, principal in Mercer's retirement business, said: "It's vital that the government explains exactly who will bear the costs of the compensation and how much they must pay.

"This seems to require the Wisdom of Solomon."

Those affected would receive 90 per cent of their pension under the proposed scheme.

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