Question to the HM Treasury:

To ask the Chancellor of the Exchequer, what assessment he has made of the effect of establishing HMRC as a secondary preferential creditor in insolvencies on the sustainability of the Pension Protection Fund.

The Government carefully considered the case for reform prior to announcing this change last year, and it is the Government’s view that taxpayers can reasonably expect that when they have successfully paid their taxes, these go to fund public services as intended.

This measure represents a proportionate approach that balances the interests of taxpayers, the Exchequer, and other creditors.

The Government expects the impact on the sustainability of Pension Protection Fund (PPF) to be marginal. This reform will not lead to a significant change in recoveries to the PPF compared to current returns.

The Government does not expect this reform to affect significantly SMEs’ access to finance or corporate insolvencies, and in line with the Government’s commitment to open and consultative policymaking is engaging with a wide variety of stakeholders to ensure policy changes are well informed and based upon the best available evidence.