Delinquent employers who fail to pay their workers' pension contributions to the Government and then liquidate their firms are to be held financially responsible under a new law.

The Contributory Pensions Amendment Act 2006 will allow action to be taken against directors and officers of ailing companies who use the payments to prop up their business instead of paying it into the Contributory Pension Fund.

Finance Minister Paula Cox told the House of Assembly on Friday that the "reprehensible" practice meant that as of July 31 last year there was more than $2.3 million of delinquent debt attributable to employers who owed more than $40,000 to the Contributory Pension Fund and whose debt was more than 90 days old. She said another $2.2 million was owed by employers whose businesses had gone into receivership.

"In many instances, it appeared that such employers were using the funds as part of operating cash flow in an unsuccessful attempt to service other operating costs and payables," added Ms Cox.

She said the new legislation ? which passed its third reading in the House on Friday and will now go before the Senate ? sought to "bring an additional measure of justice to workers and to ensure that they enjoy their full retirement benefits for which they have worked so hard".

More than 8,000 seniors currently receive a state pension, with 72 percent of those getting the basic amount of just over $826 a month. The maximum amount payable is about $1,075. Ms Cox said: "Government has looked at the record of contributions and knows that had employers consistently paid contributions when they were due then a much higher proportion of today's seniors would be getting the maximum pension because all of their contributions would have been paid into the Fund.

"This bill therefore is Government's response to the noticeable problem with certain employers who liquidate their failing companies and walk away from their responsibility to employees in the form of unpaid pension contributions. This has the ultimate effect of reducing the pension benefits of affected employees if the contributions are not paid.

"In addition, there is the follow-on effect of increased financial burden to be shouldered by various Government social services to bridge the retirement income gap caused by the irresponsible behaviour of such employers."

The bill would have originally only allowed the Government to tackle employers who had not paid the contributions in the past three years. But after that was queried by Opposition MPs Grant Gibbons, Louise Jackson and John Barritt and PLP chief whip Ottiwell Simmons, Ms Cox tabled an amendment which means retroactivity will extend back 20 years. Shadow Finance Minister Patricia Gordon-Pamplin said employers who failed to pay in the contributions were guilty of a despicable act.