As Barclays bank moves towards a significant change in its final salary pension scheme, supermarket chain William Morrison has today followed suit suggesting that future benefits for its 10,000 final salary scheme members will be based on average career earnings and not their final salary. This is a significant change in the future make-up of the William Morrison pension scheme and one which is being reflected in other parts of the UK economy.

Unfortunately, what started as a trickle is almost certain to turn into a tidal wave as UK businesses look to cut their future pension liabilities and concentrate more on their main stream operations. When you consider the billions upon billions of pounds of pension fund deficits around the UK this was only a matter of time as historic changes to the taxation of pension assets and pension income is starting to hit home.

So far the UK government has been very quiet on the subject of final salary pension schemes, despite the fact that MPs have their own final salary scheme, but frankly there is little they can do as changes in the past have finally taken their toll. A move to money purchase pension schemes will see many people receive significantly lower pensions in the future.

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