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Welfare Reform on the Web (March 2001): Pensions - UK

HINT OF COMPULSION IF STAKEHOLDERS FLOP

F. Littlewood

Times, Dec. 13th 2000, p. 26

The Pensions Minister has hinted that the Government will make contribution to stakeholder pensions compulsory for people earning £10,000 -£20,000 a year who do not belong to an occupational scheme if take up is low.

AN INEQUITABLE PENSIONS POLICY

W. Hutton and C. Thorne

Financial Times, Jan. 10th 2001, p. 21

Pay-as-you-go state pension provision is being replaced by funded private provision. Private and occupational schemes that define final benefits are being replaced by defined contribution schemes. Thus individuals are coming to depend on pension funds subject to stock market fluctuations and niggardly annuity rates. Article calls for the restoration of a decent state pension which is not dependent on stock market performance or annuity rates.

LIGHT THE FUSE AND RETIRE

Anon.

New Review of the Low Pay Unit, no. 66, 2000, p. 14-15

It is clear that the basic state pension will play an ever-smaller role in providing retirement income in the future. Retirement income will come increasingly from funded pension schemes and individual savings, with means-tested top-ups for the poorest pensioners. The proposed Pension Credit will raise the income of the poorest pensioners through a higher guaranteed minimum income, and boost the incomes of pensioners with modest savings and/or small occupational pensions through its savings credit.

MINISTERS WARNED OVER PENSIONS SHAKE-UP

S. Targett

Financial Times, Jan. 15th 2001, p. 2

New research published by the Prudential shows that 63% of small and medium-sized businesses are unaware that stake-holder pensions will be available from April. Some 31% of SMEs that do not currently offer employees a pension scheme risk a fine of up to £50,000 because they do not intend to provide staff with access to a stakeholder pension.

(See also Guardian, Jan. 15th 2001, p. 22)

PENSIONS GREEN PAPER: A GENERATIONAL ACCOUNTING PERSPECTIVE

P. Agulnik, R. Cardarelli and J. Sefton

Economic Journal, vol. 110, Nov. 2000, p. F598-610

Note shows how the policy proposals in the government's green paper on pensions affect the long term sustainability of the UK's public finances and redistribution between current and future generations. Analysis shows that currently living generations benefit from the proposed reforms to the detriment of those yet to be born. The cost burden of the reforms is however not spread evenly over the future, but is loaded more to the distant than the near future.

STAKEHOLDER PLANS: ARMAGEDDON OR NEW OPPORTUNITY?

B. Lang

Pension International, no. 25, 2000, p. 18-19

In order to operate successfully in the market for low-cost Stakeholder Pensions, providers will need to control costs by selling products online via the Internet, and by selling them "bundled" with other more profitable products, and to attract customers by targeting affinity groups such as trade unions and trade associations.