Pensions howler forces rethink

OFFICIAL figures for pension contributions might have been exaggerated, the Government has disclosed. Apologising for the second such mistake in recent months, Work and Pensions Secretary Andrew Smith said he had ordered an urgent review of the figures.

Ministers had published the contribution figures in good faith, he said, but a mix-up over transferred funds could have a 'significant impact' on the official level of contributions to funds.

Smith had told MPs that the Government was to consider 'concerted and radical action' to sustain final-salary pension schemes, being cut by firms. But he said it was vital that policy was informed by accurate statistics.

'We have now been informed by the Office of National Statistics that there are problems with the series from which these have been estimated in the past, notably on the question of transfers, which the ONS now tell us are derivable and could be significant', he said.

'The ONS is to lead a review of these statistics as a matter of urgency. We apologise where figures previously given in good faith by ministers on the level of pension contributions are now subject to review.'

Ministers were recently forced to withdraw statistics on the total amounts saved in pension funds after it emerged that they contained mistakes.

Shadow work and pensions secretary David Willetts said the Government should reconsider its position on pensions after the new statistics were published.