The government has announced that £2.9bn is to be injected into the Financial Assistance Scheme (FAS) to enable it to be extended in two respects:
- to increase the compensation payable, from the scheme’s normal retirement age (minimum age 60), to 90 per cent of the expected pension, subject to a £26,000 cap (i.e. broadly in line with PPF compensation for non-pensioners); payments are to be backdated to 14 May 2004, the date the FAS was first announced
- to cover scheme members whose employer was solvent when the scheme became insolvent between January 1997 and April 2005, bringing a further 11,000 scheme members within the scope of the FAS.
Final details will be confirmed in the New Year, when the government will issue draft legislation