§ Mr. Burns
To ask the Secretary of State for Northern Ireland whether in the light of the voluntary contributions requirements of article 14 of the Social Security (Northern Ireland) Order 1986, he proposes to introduce additional facilities for AVCs within the teachers' superannuation scheme; and if he will make a statement.
§ Mr. Needham
Prudential Pension Fund Services has been appointed to provide a new additional voluntary 427W contribution (AVC) scheme for teachers who are members of the teachers' superannuation scheme for Northern Ireland.
It is intended to make regulations as soon as possible to give effect to the new scheme, and to secure approval for it under section 592 of the Income and Corporation Taxes Act 1988 so that teachers' contributions are allowable as a deducation from income before assessment to tax. Subject to these requirements, the scheme is intended to come into operation on 1 April 1989, enabling members to secure tax relief on single premium payments in the 1988–89 tax year.
The AVC scheme will offer a flexible, money purchase alternative to the existing provision for buying in added years. Members will be able to choose to invest their contributions in a with-profit or a unit-linked fund, or on cash deposit at building society rates of interest, or to apply them to the purchase of additional life insurance cover, or in any combination of these investment vehicles. Members will also be free to vary their contributions, and their allocation between investments, at any time.