Pensions: From Final Salary to the Final Straw

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When is a fraud not a fraud? This is a question that millions of people will be asking themselves as increasing numbers of employers reduce, or default on, pensions that workers have been paying into for years.

One of the major causes of the growing pensions crisis is the closure of 'final salary' schemes. Fifty six percent of companies which have reviewed these in the past five years have closed them to new applicants according to consultants Watson Wyatt, and many existing employees have been switched to more risky 'money purchase' schemes. On average bosses pay half into these schemes what they would to final salary pensions.

Pensions: One Hand in the Till

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Pensions--once the bedrock of the welfare state--are under attack as never before. Solomon Hughes explains why this is connected to the spread of global capital.

Pensions have leapt from the personal finance supplements to the front page. Last month the 'Daily Mail' argued that government should 'end this pensions disgrace' by cracking down on management 'pension wreckers'. The 'Mail' declared, 'It is outrageous that loyal, prudent workers should be bilked out of their pension' as 'cynical employers' walk away from their obligations, closing schemes while enjoying their own 'generous pensions'. Not only did this arch Tory newspaper call for legal restraint on the employers, it also called for a 'government safety net' for pensioners.

Move Over, Darling

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Is your pension at risk? Yes, minister.

You would either need to have a very short memory or a tremendously blinkered New Labour kind of mindset to regard the latest crisis in the pensions industry as not worth getting all that worked up about. When a whole series of the biggest firms in the country suddenly announce that they are pulling out of 'final salary' pension schemes--because they claim they can no longer afford the payouts--and the top man at the National Association of Pension Funds starts talking about people having to work on to the age of 72, some of us might start to get a bit nervous.


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