The Guardian, June 22nd 2010, p. 7
Union leaders have accused the government of using 'scare tactics' to inflate the cost of final-salary public-sector pensions, after ministers hinted that nurses and teachers would be asked to pay more towards their retirement plans. The TUC has warned that figures showing a £1tn black hole in the public service pension system were based on a misreading of the way unfunded 'pay-as-you-go' retirement plans work and exaggerated the costs to the Exchequer.
Random House Business Books, 2010
This book investigates the state of the pensions system in Britain, focusing on policy decisions that have had a detrimental effect on it and the welfare of those who rely on the state pension to support them in retirement.
Daily Telegraph, June 21st 2010, p. 1 + 2
Predicts that the government commission led by John Hutton which is looking into public sector pensions will recommend that state employees be required to contribute significantly more to their pension pots out of their salaries from 2011, substantially reducing the amount the taxpayer has to contribute. The Chancellor of the Exchequer, George Osborne, is of the opinion that the disparity between public and private sector pensions is unsustainable as Britain enters an age of austerity.
L. Armitstead and M. Butterworth
Daily Telegraph, June 10th 2010, p. 1 + 2
British private and occupational pension funds have invested heavily in BP shares. Attacks by President Obama on BP's handling of the Gulf of Mexico oil spill have caused its share price to plummet. Before the accident on April 20th 2010, BP was Britain's biggest company, with a stock market value of £122bn. By June 10th 2010, £49bn had been wiped off its value. Every time BP's share price falls, the value of individuals' pension pots falls if the funds have been invested in BP stocks and shares.
Financial Times, June 23rd 2010, p. 2
The Government has appointed former work and pensions secretary John Hutton to lead a review of public sector pensions. The interim report in September will explore options for contributions to the reduction of the structural deficit over the next three years.
Daily Telegraph, June 15th 2010, p. 1 + 4
According to the Office for Budget Responsibility, the cost to the taxpayer of funding defined benefit public sector pensions will more than double in the next five years to £4,000 per household as a result of population ageing. This level of expenditure is unaffordable, and the Coalition government has signalled that it will be urgently reviewed and reformed.
(See also Daily Telegraph, June 16th 2010, p. 10)
Financial Times, June. 16th 2010, p. 4
This article compares public sector pension schemes with those in the private sector, noting how many final salary schemes have closed, that retirement ages in the public sector have been raised, and that most public sector staff are on low salaries and therefore low pensions when they retire. Provides useful charts, facts and figures, including the Treasury forecast that the cost of public sector pensions will still be less than two per cent of GDP by 2033 .
Financial Times, June 25th 2010, p. 2
A review of the age at which the state pension should be paid has been launched by the Government, which includes phasing out the default retirement age that allows employers to require staff to leave at age 65.
F. Elliott and G. Gilmore
The Times, June 14th 2010, p.7
The Office for Budget Responsibility has concluded that the ageing population will place an increasing burden on Britain's ability to move out of recession. They are expected to conclude that the economy will grow more slowly than was previously expected. The civil service pension liabilities will add £1 trillion to the deficit, according to the research.
N. Midgley, H. Wallop and E. Simon
Daily Telegraph, June 30th 2010, p. 4
The poor performance of its investments and increasing longevity have left the BBC pension fund with a deficit of £2bn. In response, the Corporation will close the current final salary scheme to new entrants from Dec.1st 2010, and replace it with a defined contribution scheme. For workers remaining in the current scheme, the final salary on which their pension is based will be their 2010 wages. These will be presumed to rise by only 1% per year until they retire.
Ageing and Society, vol. 30, 2010, p. 421-443
In the Employment Equality (Age) Regulations 2006, the UK government set a default retirement age of 65 years after which an employer can compulsorily retire workers, and made it obligatory for employers to consider the 'business case' for any employees' requests to work beyond the default age. This is a 'light touch' approach to reducing age discrimination in the workplace and to changing the established 'culture of retirement'. While encouraging productive staff to remain in post beyond 65 years of age, it leaves implementation of the policies and achievement of their goals to the discretion of employers. This article explores how British employers are adapting to the law, drawing on interviews with 70 managers from a wide range of organisations.
Daily Telegraph, June 25th 2010, p. 4
Ian Duncan Smith, work and pensions secretary, has outlined planned reforms to the UK's retirement system. These include:
(See also Daily Telegraph, June 24th 2010, p. 1 + 2)