Government Set To Push Through Pension Reform
While there has been much criticism of the government’s handling of the ongoing pension crisis there seems to be action at last from the authorities with regard to schemes which are under funded. Mike O’Brien, the Pensions Reform Minister, is ready to announce a change to the current laws which will give the Pensions Regulator a lot more power.
It is hoped that the new power will be used to order companies to top up their pension funds in order to ensure the future payment of pensions. While the change looks very straight forward and sensible there are fears in the pensions industry that the direct involvement of the regulator in these matters will put at risk any future final salary schemes.
There are also concerns that by forcing the pension administrators to increase contributions this will affect the overall health of the business and put major strains on cash flow. Recently there have been a number of high profile schemes that have ‘encouraged’ their members to convert to money purchase schemes with the promise of short term rewards and bonuses. However, the problem is that what looks good in the short term may not be as beneficial in the longer term.
Share this..
Related stories
Is Lloyds looking at revising HBOS offer?
Since the deal to merge Lloyds Bank and HBOS was announced there has been a wave of criticism crashing against the Lloyds Bank boardroom door. Well it looks as though Lloyds Bank may well have the last laugh with rumours they are looking to revise the HBOS offer. Currently priced at 0.83 Lloyds Bank shares for every HBOS share there are strong signs that this could be revised down to 0.6 Lloyds...
Read MoreHalifax forecasts flat UK housing market in 2010
Hot on the heels of the Nationwide Property survey which suggested a 10% to 15% increase in UK property prices in 2010, the Halifax survey is very different. After revealing that house prices grew by just 0.6% in January 2010, against a six monthly average of 1.1%, there are growing fears that more properties will be brought to market which will see pressure on prices. The average home in the U...
Read MoreCan the building society sector survive the ongoing recession?
As news of significant debt downgrades in the building society sector continues to sink into the financial markets, there are concerns about the age old mutual sector. While UK banks have grabbed the headlines over the last few months, taking significant finance from UK taxpayers, building societies in general have remained fairly stable with the exception of a couple of smaller societies.
...
Are the John Lewis sales figures telling us something?
Last week we saw the disclosure of weekly sales figures from John Lewis, one of the U.K.'s bellwethers of the retail sector. Unfortunately, as with the week before, sales were down again at the chain and the company is starting to make noises regarding tough trading in UK retail sector. Even though this is only two weeks of sales figures the fact that the company has seen fit to issue a downbeat s...
Read MorePensions Black Hole May Reduce Taxes By £10 Billion A Year
Even though we are seeing more and more final salary company pension schemes sold off to third parties in order to reduce company liabilities and exposure, it seems that the short fall which many are having to make-up before selling their schemes may cost the Treasury dearly. Leaders of the pensions industry have flagged the problem which seems to be getting worse. In essence the problem revol...
Read More