MPs urge axed pension schemes help

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Only those whose firms have gone bust can currently claim help through the Financial Assistance Scheme.

But the influential cross-party Public Administration Committee called on ministers to extend support to people who lose out when companies close pensions but remain solvent.

Such a proposal is currently before Parliament in a House of Lords amendment to the Pensions Bill.

Tony Wright, the committee's Labour chairman, called on MPs to consider the idea when the Bill came before the Commons.

"The Government has already made significant concessions, but we believe it should accept that members of all schemes which were wound up without the assets to support their pensions promise need assistance, regardless of whether or not the employer remained solvent," he said.

"There is no difference in the difficulties and losses suffered by those whose schemes were underfunded because their employer became insolvent, or those whose schemes were underfunded because their employer took advantage of the inadequate legal framework in place before June 2003."

The Department for Work and Pensions said there was "scope for debate".

A spokesman said: "Solvent employers have a moral obligation to keep their pension promises to scheme members.

"The alternative would be taxpayers stepping in to make pension payments but we acknowledge that this is a complex area and that there may be scope for debate about the dimensions of the Financial Assistance Scheme."