There are concerns this evening that proposed changes to the retirement age in the UK, which could see more and more people working into their 70s, will have a major impact upon a "lost generation" of younger workers. So how will the changes actually affect the UK employment market?
Leslie Seldon, a former partner of Clarkson Wright and Jakes solicitors, has lost a discrimination case at the Court of Appeal with regards to the fact he was forced to retire at 65. It would appear that under the terms of this partnership agreement he was forced to retire from the company which he believed was a case of discrimination.
The UK government is set to introduce changes to the UK pension fund system which could severely impact the value of final salary pension schemes in the UK. Only hours after BP chief executive Tony Hayward left the group with a rumoured £600,000 a year pension the government is set to reduce the maximum amount which can be sheltered in a pension scheme in any one year.
BT, the UK telecoms giant, was today informed by the telecoms regulator that there is no obvious reason why the company should be allowed to increase wholesale charges in order to help plug the gap in the company's pension scheme. The company had hoped that the regulator would look favourably upon the request to increase wholesale charges which would have helped to pay down the £9 billion pension fund deficit.
Over the last few days we have seen confirmation of multi-billion pound deficits in a variety of UK pension schemes which many believe will sound the death knell for final salary pension schemes. These are schemes which are based upon the length of service of the underlying scheme member and their salary at retirement. There is no reference to investment returns over the period and as such a number of pension schemes in the UK are in serious financial trouble. So will final salary pension schemes disappear forever?
Uniq, the food supplier for companies such as Marks & Spencer, is today under the spotlight after the UK Pension Regulator rejected proposals to cut the company's £436 million pension fund deficit. This was a major blow to the company after proposing an innovative way of raising money to reduce the short-term pressure on the company's cash flow and pension from liability.
There is no doubt that the UK government has a number of specific ideas and tasks in mind for the UK pension fund industry. We have seen George Osborne and David Cameron attempt to tackle the monumental problem of public sector final salary pension schemes as well as various taxation changes with regards to the purchase of annuities and the ability to transfer assets upon death. Will this reinvigorate the UK pension fund industry?
The subject of pensions and savings is something which has been in the headlines for some time now and subjects which many people are becoming increasing concerned about. The ever-raising cost of living in the UK is far and away outpacing investment returns and interest on savings thereby pushing more and more people towards financial uncertainty in their later years.
George Osborne has announced a number of proposals with regards to future pension arrangements in the private sector and the public sector. One which has caught the eye of many in the UK is the proposal that those aged over 75 should not be forced to buy annuities to secure their income in later life. So what does this mean for those in retirement?
This week will see a very important case come to court in a move instigated by the trustees of the BT pension scheme who are looking to clarify the extent to which the UK government would underwrite the pension scheme via its "crown guarantee". Both BT and the trustees of the BT pension scheme have been in talks for some time about reducing the £9 billion deficit which has built up over the last few years. This is by far and away the largest defined benefit pension scheme in the UK and the funding shortfall has impacted upon the amount of funding available to pay dividends to shareholders.
