A major new research paper produced by Michael Johnson for the Centre for Policy Studies has highlighted that, despite reassurances from the Government to the contrary, the current round of public sector pension reform (even though still not completed) may not see time called on the issue for very long.
As has been suspected by many, myself included, the major concessions won by the trade unions from the government will mean that the changes will do little to improve the public finances, will merely further divide our public and private sector and will commit us to a cashflow deficit of over £15bn by 2016/17. That’s a 77-fold increase in only 11 years and will mean that the annual burden on tax payers will rise to £32bn – the equivalent of £1,230 for every household in the country. It also means that £4 out of every £5 paid in pensions to former public sector workers is paid by the tax payer. Read more »
The Department for Work and Pensions (DWP) have recently published a report with their ideas of how to reinvigorate pensions in the workplace.
Steve Webb, the Pensions Minister, has been very vocal in his support of the concept of defined ambition. Put another way it is a watered down version of defined benefit pensions or maybe just mix and match i.e. when the good times roll then have a £20 box of chocolates, otherwise you might have to make do with the £1 version. Read more »
Finance Directors of charities not disclosing their multi-employer pension liabilities on their balance sheet may be sleeping just a little uncomfortably at the moment following a consultation document issued by the Financial Reporting Council.
If the proposals are accepted charities will need to recognise any agreement to fund a deficit in a multi-employer scheme on their balance sheet. Read more »
Following the recent spotlight on company-lead incentive and exchanges exercises, it was only a matter of time before the old chestnut of cash commutation rates made a re-appearance.
According to reports, the “scandal” of cash commutation rates is costing defined benefit pension scheme members £2-3 billion pounds per year. There were also hints at industry-lead complicity and conspiracy in offering poor value to members. My reaction – why let the facts get in the way of a good story? Read more »