Welfare Reform on the Web (Summer 2003): Pensions - UK

COMPANIES WILL BE BOUND ON PENSIONS

N. Timmins and N. Cohen

Financial Times, June 12th 2003, p.1

Solvent companies will have to meet their pension promises in full, Andrew Smith, the Work and Pensions Secretary has declared. He also announced an insurance scheme to provide most workers with up to 90% of their expected benefits if a company goes bankrupt.

(See also: Financial Times, June 12th 2003, p.2; The Times, June 12th 2003, p.1)

OPRA: TACKLING THE RISKS TO PENSION SCHEME MEMBERS

Committee of Public Accounts

London: TSO, 2003 (House of Commons Papers, session 2002/03; HC589)

The paper concludes that OPRA and the Department for Work and Pensions have been slow to develop objectives and tackle legislative constraints and as a result have failed to address major risks to pension scheme members. OPRA has largely limited itself to tackling procedural breaches of the Pensions Act 1995 and admitted it could not be sure of detecting a major theft of funds. It has focused on trivial cases and has done little to check the suitability of trustees or the appointment of advisers to pension funds.

PENSION INSURANCE "WILL FAIL TO STEM DECLINE"

N. Timmins

Financial Times, June 13th2003, p.6

Government moves to force employers to stand by their pension promises may provide employees with more protection but does nothing to solve the larger pension crisis, insurers and pressure groups have warned.

PENSIONS' INSURANCE PLAN DRAFTED

N. Cohen and K. Guha

Financial Times, June 4th 2003, p.1,3

Proposals for compulsory insurance to final salary pensions are being drawn up by civil servants as pressure mounts on the government to provide a safety net for workers whose schemes do not have enough money to pay promised benefits.

SIMPLICITY, SECURITY AND CHOICE: WORKING AND SAVING FOR RETIREMENT: ACTION ON OCCUPATIONAL PENSIONS

Department for work and pensions

London: TSO, 2003 (Cm 5835)

Government will attempt to defuse the crisis in occupational pensions by encouraging people to extend their working lives. The earliest age at which an occupational pension can be taken will be raised from 50 to 55 by 2010 and the normal retirement age for public service workers will go up from 60 to 65. Government will also introduce measures to improve the safeguards for members of occupational pension schemes by:

• introducing a pension protection fund;
• establishing a new private pensions regulator to root out fraud;
• requiring employees to consult before making changes to schemes;
• requiring employers who wind up their schemes to meet their pension promises in full.

WOMEN AND PENSIONS: TIME FOR A RETHINK

E. Evason and L. Spence

Social Policy and Administration, Vol. 37, 2003, p.253-270

The paper presents the results of a research project on women and pensions in Northern Ireland. Focus group discussions showed that women were confused about how they were supposed to make provision for their retirement. There was considerable hostility towards the current government strategy of allowing the basic state pension to wither away in favour more generous means tested help. There was a strong preference for the state to have the lead role in pension provision, and for an adequate state pension based on citizenship.