Can we kiss goodbye to final salary pension schemes in the private sector?
The news that the top companies in the UK have combined pension fund deficits in excess of £100 billion due to the fall in share prices, property values and income, we may be on the verge of kissing goodbye to final salary pension schemes. The situation has worsened significantly over the last 12 months and has also shown the fragility associated with pension fund investments in stock markets. The ever-increasing tax burden on pension income and pension funds has also reduced investment returns and ultimately the combination of the above has proved devastating to many.
With the likes of Shell showing a multibillion pound deficit on their pension scheme it is only matter of time before final salary pension schemes in the private sector are no more. This comes at a time when public sector pension schemes, i.e. MPs and local authorities, continue to thrive and are still commonplace around the UK. While these funds are covered by the UK taxpayer, there is no such safety net for the UK population who have to fund their own pension arrangements due to an ongoing reduction in the real value of the UK state pension.
The UK pension industry has changed significantly over the last 20 years and could change significantly over the next 20 years.
Share this..
Related stories
Icelandic problem hits Guernsey
For so long the quiet back water where the rich and famous moved to it seems as though the financial heartache being felt around worldwide markets has hit Guernsey. It has been confirmed that those who held money with and Icelandic banks will only receive a maximum of 30% in compensation with some expected to receive nothing. So has the bubble burst on Guernsey? Is this now the end of the venue...
Read MoreCan sporting events impact upon the economy?
Today's victory by the England cricket team, which saw them snatch back the Ashes from the Australians, has given UK sport a massive boost in these most difficult economic times. However, there is a debate ongoing as to whether sporting events can actually impact on the economy and if so what kind of impact they can have.
Those who are sceptical of the impact of sporting success on...
Low deposit mortgage agreements very scarce
It has been revealed that a great number of mortgage providers in the UK are rejecting low deposit applications with some estimating as many as 90% of such applications are turned down. Despite the fact that the industry would like us to believe competition in the mortgage market is on the increase and first-time buyers are now coming back to the fore, it seems very much to be the opposite. So whe...
Read MoreTaylor Wimpey looks elsewhere for additional funding
UK housebuilder Taylor Wimpey today announced that talks with its bankers regarding current banking covenants have been a little disappointing and the group is looking for outside investors to help strengthen the company's balance sheet. The finances of the group are set to take a further hit with a £1.2 billion of write-down expected in the short term.
Chris Rickard, the new finan...
NS&I predicts savings downturn
Savings levels are likely to drop over the months to come, according to National Savings & Investments (NS&I).The government-backed accounts provider said that the proportion of income saved averaged 6.4 per cent over the summer and autumn.This is down on 2005's figure of 7.16 per cent - taken at a time when the economy was still booming.NS&I said that 47 per cent of people are still saving regula...
Read More