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

BUSINESSES RISK PENALTY OVER PENSION COMPLIANCE

A. Jolliffe

Financial Times, Aug. 7th 2001, p.3

Research has shown that 11% of employers who are aware of the need to set up stakeholder pension schemes by October 8th 2001 plan to leave it until the last minute. They are risking fines of up to £50,000 for non-compliance.

CGNU IN ATTACK ON PENSION REFORMS

J. Moore

Times, Jul. 19th 2001, p.26

Article discusses CGNU's criticism of the government's low-cost stakeholder pension scheme. It says that the government reforms will do nothing to benefit those on low incomes with salaries ranging from £8,000 to £20,000. It does not think government advertising will increase peoples savings and it fears that stakeholder pensions will be used as a middle-class tax break.

GOVERNMENT MOVES TO TACKLE PENSION CRISIS

S. Brown

Public Finance, Jul. 20th-26th 2001, p.12

The debate on the 'unfunded' police and fire pension schemes has been reopened. The move by the Treasury, Home Office and the Dept of Transport, Local Government and the Regions has been welcomed by police and fire leaders. The "unfunded" schemes currently in operation means that these services operate on a pay-as-you-go basis. Former uniformed officers are paid out of today's operational budgets. Article goes on to discuss the severity of the problem and the options that are now open for resolving them.

THE IMPACT OF THE GENDER PAY GAP ON POST-RETIREMENT EARNINGS

O. Gough

Critical Social Policy, vol.21, 2001, p.311-334

Article examines the factors affecting women's earnings during their working years that go on to affect earnings in retirement. It argues that factors relating to part-time working, career patterns and types of occupation and employment, contribute not only to keeping women's income lower than men's during their working life, but also to a reduced entitlement to benefits from occupational pension schemes after retirement. With the effects of women's greater longevity taken into account, a picture emerges of a greater number of women facing poverty in old age.

A NEW CONTRACT FOR RETIREMENT: AN INTERIM REPORT

London: Institute for Public Policy Research 2001

Report attacks the government's approach to pensions and long-term care. The complexity and cost of the proposed pension credit has cast doubt on whether stakeholder pensions will reach their target group (those on between half average and average earnings). The report goes as far as to suggest that 'pension schemes be made compulsory to encourage savings'.

SLOW START FOR STAKEHOLDER PENSIONS INCREASES PRESSURE FOR COMPULSION

P. Jenkins

Financial Times, Aug. 14th 2001, p.1

Pressure is building on the government to make stakeholder pensions compulsory following low take up of the scheme.

STAKEHOLDER PENSIONS START WELL

A. Bolger

Financial Times, July 23rd 2001, p.2

Research by the Association of British Insurers suggests that up to 500,000 people on moderate incomes may take out stakeholder pensions by April 2002. Of potential customers who say they are unlikely to take out a stakeholder pension, almost 40% would be more likely to do so if it were arranged through their employer. This would rise to more than 50% if the employer were prepared to contribute.

SURGE IN NUMBER OF UNDERFUNDED PENSIONS

P. Jenkins

Financial Times, Aug. 15th 2001, p.4

Actuaries Bacon and Woodrow have found 17 underfunded defined benefit pension schemes at FTSE 100 companies in the annual survey of company accounts. Falling interest rates and increasing life expectancy are hitting defined benefit schemes hard, and low or negative returns on pension fund assets are compounding the problem.

(See also Times, Aug. 15th 2001, p.22).

UK BUSINESSES FACE FINES OF £2.5 BN OVER LATE PENSIONS

W. Kay

Independent, Aug. 6th 2001, p.13

Companies that miss the 8th October deadline for setting up stakeholder pension schemes could face fines of up to £50,000. "All companies employing five or more staff, where there is not already a qualifying workplace pension scheme, have to set up a stakeholder by 8 October" by law. Article goes on to discuss Virgin's findings on the number of companies who are aware of the stakeholder requirements and those who plan to leave it until the last minute.