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Treasury considering pension scheme insurance

The Treasury is mulling over the idea of creating an insurance fund to bail out bankrupt company pension schemes.

The £8bn Central Discontinuance Fund, would initially be funded through the sale of Government bonds and gilts. In subsequent years, the funding would come from a 0.1 per cent levy on outstanding pension fund assets.

Such a move would satisfy the demand from pensions and investment funds for secure long term investment.

It would be part of the Government&#39s Minimum Funding Requirement, which states pension providers must hold assets matching those of liabilities it owes to pensioners.

The scheme, if accepted, would kick in when bankrupt employers become unable to support pension schemes.

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