With the tax on pensions introduced early on by the government pension funds were struggling. There always have been tensions between final salary pension schemes and defined contribution schemes. Industry and Commerce find it difficult to cope with the uncertainty of the defined contribution schemes. When inflation was higher it was easy for them to cope as the effect of inflation whittled away the benefits (and costs) of the pension schemes.
Then Labour introduce a new levy on final salary schemes. It seems a clever wheeze at the time to underwrite some final salary schemes through other ones. The end result, however, is to put more pressure on companies to close them down.
It is a bit like Labour's tax on fuel. Inevitably this has some effect in putting up costs of fuel. Gordon Brown's removal of ACT at the time seemed to have no immediate effect. The effects was entirely down the line.
The story is in the press today that soon in the private sector the number of people with defined contribution schemes will exceed those of defined benefits.
Then Labour introduce a new levy on final salary schemes. It seems a clever wheeze at the time to underwrite some final salary schemes through other ones. The end result, however, is to put more pressure on companies to close them down.
It is a bit like Labour's tax on fuel. Inevitably this has some effect in putting up costs of fuel. Gordon Brown's removal of ACT at the time seemed to have no immediate effect. The effects was entirely down the line.
The story is in the press today that soon in the private sector the number of people with defined contribution schemes will exceed those of defined benefits.
Comments
And if it hadn't been for the Pensions Protection Fund, those former employees at Rover would have had nothing to show for their long service. Of course, your former friends who ran the company into the ground would still walk away with their millions, so they'd be all right.
But then, if the Liberal Democrats had been in power, Rover would have staggered on for a whole extra month before collapsing without any pensions protection for the workforce.
The pressure on directors to handle the uncertainty of pensions comes from shareholders who are substantially pension funds.
I accept the point that directors should not escape any changes to final salary schemes. There is an argument for a conflict of interest there which arguably could have a statutory resolution.
But I don't think compulsory contributions are part of the situation.
Much that people would not get employer's contributions if they don't contribute themselves.
In any event the whole thing assumes that money is the key thing rather than resources.
http://www.libdems.org.uk/party/policy/paperlist.html
meant they were actually Lib Dem policies. instead of just a vague wish list. no wonder people get confused and think that the Lib dems are just trying to be everything to everybody.
Or could it just be that John hasn't troubled to read them?