Private companies such as Richard Branson's Virgin could be involved in providing ''stakeholder'' second pensions, Welfare Reform Minister Frank Field said yesterday.
Mr Field raised the prospect of private companies forming their own non-profit-making pension mutuals to be involved in the idea.
''The private sector who wanted to be in this area would establish their own mutuals with their own brand name. So it would be Virgin Mutual, Legal and General Mutual, Prudential Mutual . . .'' he said.
He also claimed that there was now an ''overwhelming weight of evidence'' in favour of extending compulsion in second pensions.
He signalled the Government's intention to scrap the current ''all-work test'' for incapacity benefit and move to a new ''employability'' test.
Mr Field, the Minister told by Tony Blair to think the unthinkable about welfare reform, last week raised the prospect of private companies being ''approved welfare providers''.
But, in an interview for LWT's Jonathan Dimbleby programme yesterday, he went into greater detail and said private firms could be involved in setting up mutuals to help provide a second tier of stakeholder pensions. He suggested the private sector could want to get involved in non-profit-making ventures in the hope of attracting future business.
''They would actually want to do that and they would be governed by all the rules that you couldn't make money out of this.
''If you made profits, it would have to go back in benefits, because they would hope by doing such a good job, people would trust the brand name to sell them the other forms of pension provision.''
Mr Field stood up for his beleaguered boss, Social Security Secretary Harriet Harman, who has faced repeated rumours that she could be replaced in a Cabinet reshuffle. He stressed that she had set in hand the ''most careful review'' about pensions living standards, which would report shortly.
The public had also been invited to give their own views and Mr Field said the ''overwhelming weight of that evidence came down in favour of extending compulsion, and the Government is looking seriously at that evidence''.
People realised that they would have to be forced to make the extra provision, said Mr Field.
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