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Welfare Reform on the Web (August 2006) : Pensions - UK

Activism reaches the trading floor


Labour Research, vol.95, July 2006, p.12-14

Pension funds own 16% of all shares listed on the stock market and a third of pension fund trustees must now be chosen by the members. The TUC is pushing for union trustees of pension funds to become much more active and not leave all the investment decisions to professional fund managers. Large shareholders can influence company policy on the environment, treatment of employees and social responsibility.

Caught between virtue and ideological necessity: a century of pension policies in the UK

A. Walker and L. Foster

Review of Political Economy, vol.18, 2006, p.427-448

This article examines the emergence of pension provision in the UK in the early years of the 20th century and the institutionalisation of retirement some 40 years later. It then summarises subsequent reforms of the pensions system, focusing particularly on the Thatcher years and the activities of the New Labour government elected in 1997. It finally considers the likely future direction of pension provision in the UK. Public pension policy today is faced with the same two challenges as a century ago: how to provide sufficient resources to remove the risk of poverty, and, at the same time, ensure sustainable provision for future pensioners.

Pension plans need to shape up, say unions


Labour Research, vol.95, July 2006, p.9-11

Article summarises trade union reaction to the reform proposals in the government’s pensions white paper, covering changes to the state pension system, existing occupational schemes, and the new individual pension savings accounts.

Security in retirement: towards a new pensions system

Department for Work and Pensions

London: TSO, 2006 (Cm 6841)

This consultation document sets out the Government’s proposals for the long-term future of pensions and retirement savings. The first priority is to make it easier for more people to save more for their retirement. To achieve this, in 2012 a new scheme of personal accounts, providing an opportunity to contribute to a high-quality, low-cost savings vehicle, will be introduced. Secondly, the Government will reform state pensions so that they are simpler and more generous. Thirdly, caring for children and the severely disabled will build entitlement to the basic State Pension. The State Pension age will gradually rise in line with gains in average life expectancy. The Government has set five tests for the reform package. Any reformed pension system must:

  • Promote personal responsibility: tackling the problem of undersaving for retirement.
  • Be fair: protecting the poorest, and being fair to women and carers, to savers, and between generations.
  • Be simple: clarifying the respective roles of the State, the employer and the individual.
  • Be affordable: maintaining macroeconomic stability and striking the right balance for provision between the State, the employer and the individual.
  • Be sustainable: setting the basis of an enduring national consensus, while being flexible to future trends.

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