Solvent employers to come under FAS radar

Up to 11,000 more people will receive compensation from the Financial Assistance Scheme (FAS) under proposals to extend coverage to collapsed pensions schemes where the employer remains solvent.

Other draft regulations published as part of a consultation into the FAS will allow people who stop working due to ill health to retire five years before their scheme's normal retirement age.

‘People who have to stop working early because they are sick will be able to access their FAS money,’ said Mike O’Brien, minister for pensions reform.

In addition the paper proposes to speed up payments by setting a deadline for trustees and other relevant people to provide information three months before a member’s normal scheme retirement age.

‘Everybody is agreed FAS members should receive their payments as quickly as possible – so we have been continuing to work with trustees and other stakeholders to look at ways in which this process can be speeded up.’

He added: ‘The changes made by these regulations will mean we have the basic information to enable payments to be made faster.’

Last year the government increased FAS payments to 90% in line with the level of funding available under its successor the Pension Protection Fund.

The FAS covers those who saw their pension scheme go insolvent between January 1997 and April 2005.