Mission Facts News Opinion Site News Mail Us Disclaimer		Date Source Summary 05/01/2002 onlinepensioninfo We're back!. onlinepensioninfo has been relaunched with a new look and feel. Apologies for the downtime and more especially apologies to those of you who wrote to us who haven't had a reply. 12/01/2002 Guardian Victory for annuities bill. The government has failed to block a private member's bill designed to free up the pension incomes of 1.5m middle-income Britons. MP's supporting the bill said it may prove an important milestone in the campaign to end the process which legally requires people with private pensions to convert the bulk of their savings into an annuity at 75. It proposes changing the rule so that people would only be required to purchase an annuity large enough to keep them above the state support threshold. 12/01/2002 Guardian How to increase your income. There are a number of ways to improve the annuity income you will receive at retirement. Escalating annuities give you less cash early on in their life but the income rises over time. If you are suffering from ill health or have other factors which may reduce your lifespan (previous illness or smoking) you can get a substantially increased income by purchasing an impaired health annuity. With-profits or investment-linked annuities can provide another option. 12/01/2002 Guardian Gaping holes that need repair. The stock market slump has affected many retirement plans, with pension funds now 10% worse off than they were at the beginning of 2001. Many pension funds have large equity holdings. Workers nearing retirement are hardest hit as their funds will have less time to recover the lost value. Annuity rates have also dropped as inflation and interest rates remain low and life expectancy increases. This has led to cuts of 20% in retirement income compared with a year ago. 19/01/2002 Guardian Launch your pension plan early. While it is hard for young people to make sacrifices for their retirement, contributing early will provide the greatest rewards. However, it is also worth considering other investment vehicles such as ISAs, which give you more flexibility while you are young. The article recommends joining any scheme where your employer will add to your contributions, as, like the tax relief, this constitutes an instant profit. 19/01/2002 Guardian How to bowl along in retirement. People are living longer and it is vital to ensure you have the money for a long and happy retirement. Ensure you use all your tax allowances, splitting your investments with your spouse if necessary. Also if you have an open market option on your pension it may prove better value to get your annuity elsewhere. There are other tax free investments available to the retired, such as national savings certificates, or riskier equity-based investments or unit trusts, which can be used as a buffer against inflation. Consider all options when planning your retirement. 09/02/2002 Guardian Turning a pot into the pits. This week the government flatly rejected major annuity reforms and made it clear that it will block the passage of the Curry bill through the Commons. Campaigners criticised what they describe as "tinkering" with the rules rather than radical reform. 09/02/2002 Guardian Don't take the first offer you receive. There are many ways to improve your annuity income by shopping round. Many people take the annuity offered to them by their pension provider, ignoring the fact that shopping around for a better deal can boost their annuity return by up to 30%. 09/02/2002 Guardian Retirement prospects fade. With the steep decline in numbers of final salary pension schemes, fewer people will be able to take early retirement, the IFS warned. Stock market falls over the past two years will add to the burden on pension funds and force many people to work until their official retirement age. The early retirement trend of the 1990s is unlikely to continue for most men and women. 09/02/2002 Guardian Never too late to feather the nest. A Fidelity Investments survey says the biggest regret among over-45s was that they had not saved enough for retirement. The article offers ways by which you can boost your retirement fund, including stakeholder pensions, AVSs/FSAVCs and ISAs. 23/02/2002 Guardian Be afraid. Be very afraid. Employers are moving to make big savings on their pension payments by switching younger, new employees onto money purchase pension schemes, replacing the final salary schemes they provided in the past. The likely result of this is that the staff of these companies will lose out when it comes to their retirement. Many analysts are blaming the accounting standard FRS17 for the switch. 23/02/2002 Guardian Why the times have changed. The article by Philip Inman explains why the culture governing pensions has changed over the past 50 years. He points to demographic factors such as people living longer as well as the decline in stock market values causing companies to switch from final salary to money purchase schemes. 23/02/2002 Guardian How could I have been so Lincoln green?. The writer relates his experience with a money purchase scheme pushed by his employer as a new, more flexible approach to pensions. The provider turned over £5000.00 worth of contributions into around £2900.00, during one of the longest recorded periods of stock market growth. Most of the money had disappeared in charges. 23/02/2002 Guardian Time to bite the bullet. If you are one of the many people with a hotchpotch of pensions acquired by changing jobs repeatedly you should take action to organise them. If you do not frequently review them you could have your money spread over several low-value policies when your money could be working harder for you elsewhere. 23/02/2002 Guardian What you can expect from the state. If the state pension had remained pegged to average earnings since 1980 instead of being changed so its growth was based on the rate of inflation, then it would now stand at over £100.00 per week compared to its current level of around £72.00. Instead, it has fallen dramatically relative to earnings. More importantly it will only be paid at the full rate if you have built up enough qualifying years. You can however defer claiming your state pension which will give you a higher weekly amount. 02/03/2002 Guardian Now MPs want you to top up their faltering fund. MPs are preparing to award themselves a bumper pension increase despite a slide in the value of their pension fund. This will be funded at the taxpayers' expense. The MPs' pension fund is a final salary scheme which is the envy of other public sector workers. 02/03/2002 Guardian Striptease that shames a nation. British employers who now say that they are too poor to pay their workers a decent retirement income stripped over £11bn from their pension funds during the 1990s, while the stock market was booming. Many of the companies that enjoyed extended "pension holidays" are now closing final salary schemes because the pension surpluses from which they profited have now disappeared. 09/03/2002 Guardian Making ends meet after a life in the boardroom. While many companies have dismantled their final salary schemes, thus making it more difficult for their employees to prepare for retirement, many of their directors are boosting their pensions to extremely high levels. 09/03/2002 Guardian Britain: a state of confusion for the elderly. The Institute of Public Policy and Research, a "government-friendly" think- tank, has accused the government of creating excessive complexity in the system of state benefits for older people. Its report said that the Treasury should sweep away means-tested benefits and tax credits for the elderly and replace them with a flat rate pension of £100.00 per week which keeps pace with earnings. 09/03/2002 Guardian Unilever hands back large slice of £1.2bn to investors. Over the past decade, Unilever has stripped £1.2bn from its pension fund, and handed back £726m of this surplus cash to its shareholders in the form of higher profits and bigger dividends. 16/03/2002 Guardian A change of heart that may help you. A dissatisfied journalist who was mis-sold a pension by Lincoln has been repaid £7,000.00. Additionally Lincoln admitted that they had mis-sold him his pension. This precedent should allow many others to lodge claims against the company. 16/03/2002 Guardian Knowing when the time is right to jump. Many pension providers are now advising several older members of their schemes to opt back into Serps (soon to be rebranded as the State Second Pension). They argue that with poor stock market performance, and new NI rules reducing the contracting-out rebate, it is likely that many older employees will be better off by opting back into the state system. 16/03/2002 Guardian Serps: all you ever wanted to know. The article outlines what Serps is, and explains the criteria for opting in. It also outlines broadly whether it is likely to be in your interests to opt in: basically the older you are, the more likely the benefit of opting in. As men reach their early to mid 50s and women their late 40s, most insurers recommend switching back into Serps. 16/03/2002 Guardian Second helping from state. The article provides a quick outline of the State Second Pension. People on low to moderate incomes, and certain carers or people with a long-term illness or disability should benefit from the State Second Pension (S2P). 06/04/2002 Guardian Dixons switches pensions. The electrical retailer Dixons has joined the growing trend among companies and abandoned its final salary pension scheme. All employees who have joined the group since March 1 will have to join a money purchase scheme instead. The company has blamed a number of factors, but has said that the new accounting standard FRS17 was only a minor issue. 06/04/2002 Guardian The pensions bargain needs renegotiating. Over the first year in which they were available, stakeholder pensions have been something of a flop. The UK pension system has moved into crisis as big employers closed down their final salary pension schemes, just as market falls and poor annuity returns made money purchase schemes much less attractive. Legal and General has expressed a desire for the government to kick start stakeholder pensions by adding to investors' contributions into such schemes. 03/08/2002 Guardian Radical plan for the young. Since many young people are avoiding the issue of the pensions crisis, presumably on the basis that their retirement is a long way off, a group of experts have outlined a proposal for a compulsory pension scheme for younger workers. The group, led by former welfare reform minister Frank Field, are aiming the scheme at today's 25 year olds to ensure that when they come to retirement they would have an income above the poverty line. Additionally the state retirement age for these workers would be raised from 65 to 70. 10/08/2002 Guardian Workers steel themselves for a long fight. Steel workers at three factories in the UK are taking on their employer, engineering firm Caparo Group, in a bid to save their final salary pension scheme. The group intends to freeze its final salary scheme and switch its staff into a cheaper stakeholder plan. The ISTC union fears the generous pensions built up over years by workers will be effectively suspended. 17/08/2002 The Times New worries over pension funds. An actuarial firm, Watson Wyatt, has raised concerns about the health of Britain's pension industry. According to its estimates, 90% of UK companies face a deficit in their pension schemes. It also claims that the top 100 companies on the London stock exchange face a combined deficit of £35 billion, around half its total estimated deficit for the UK. Goldman Sachs and Merrill Lynch have raised similar concerns. 17/08/2002 The Times Pensions put pressure on shares. At present it is hard to see the current pension funding issue as having anything other than a negative effect on share prices. Firstly recent weaknesses in the equity market must make all investors approach equities more cautiously and therefore many will choose lower risk pension funds, or choose to put less money into pensions. Recent bad news will also decrease the flow of money into pension funds. 21/09/2002 Guardian Pensions blow for part-timers. Trade unions have appealed against two employment tribunal rulings which they believe will deny backdated pension rights to many part-time workers in both public and private sectors. The first affects the pension rights of part-time staff who worked for a private sector employer which was taken over, and those of part-time staff who worked for a public sector firm which was privatised. The second ruling relates to "stable employment", and the rights of someone who has worked on a series of contracts, punctuated by intervals without a contract, for the same employer. 28/09/2002 Guardian Fears raised over tax-free lump sum. Rumours have been spreading that the government is considering people's right to take a tax-free lump sum from their pension fund at retirement. This is a tax concession of which millions of people take advantage and people are naturally alarmed at the prospect of its removal. The NAPF and CBI called on the government to scotch the speculation on the grounds that such a move would undermine the retirement plans of many. 14/10/2002 Guardian Die now, and pay for it later. New government rules took effect this week regarding the amount of pension your spouse will inherit on your death. The net effect of these regulations is that the pension which is inherited will depend on the date you pass away and your age. Under Serps, widows and widowers who die after last Sunday will be up to £10.00 per week worse off than those whose spouse died before that date. These changes do not affect the basic state pension and don't affect anyone whose spouse died and had reached pensionable age prior to Oct 6th. 14/10/2002 Guardian Prudential moves closer to a strike. Union officials representing staff at Prudential said this week that they will ballot their membership over strike action unless the company drops plans to close its final salary scheme to new entrants. A month ago the insurer said it would force new employees to join a money purchase scheme. 19/10/2002 Guardian Scandal on the Maxwell scale. Workers at many companies who face having their pension entitlement snatched away are campaigning vigorously to highlight what's been called another major retirement saving scandal. Several employees of the steel company ASW met with senior government officials to demand a change in the law to strengthen employees' pension rights when their employers go bust. Currently when a company goes under, many of its employees could receive just a small fraction of their promised pension benefits and some may receive nothing at all. 02/11/2002 Guardian Shocking truth about pensions. Campaigners for ethical investments are highlighting the role that pension funds play in supporting the arms trade. Research by the Campaign Against the Arms Trade shows that some of the country's biggest funds, such as those of most local authorities, trades unions and NHS trusts are being invested in the arms industry. 09/11/2002 Guardian Is this the end for higher-rate tax relief?. The government's long-awaited pensions green paper outlining plans to tackle the pensions crisis is expected soon, and it is likely to affect the tax breaks which are used to tempt people to save for their retirement. There is growing speculation that higher rate tax relief on personal pension contributions may be scrapped. This may be replaced by a system where for each pound an investor puts into a pension, the state will match it, up to some limit to be specified by the government. Many middle-class higher rate taxpayers may lose out under such proposals. 23/11/2002 Guardian Stakeholder pensions flop. The insurance industry has branded stakeholder pension schems a flop, and has warned that the government's green paper on pensions will fail to tackle the looming pension crisis. There is growing evidence that the schemes are failing to appeal to those on low incomes, at whom they were intended to be targeted. The majority of stakeholder buyers earn over £20,000 p.a., which was the earnings target set by the government for stakeholders when they were launched. 23/11/2002 Guardian Anger mounts among victims. Equitable Life has now cut the retirement income of its pensioners who hold with-profits annuities as a result of its problems. These were the only remaining members who had not yet had their policies reduced. The company's chief executive has warned that the fund value could continue to fall and could breach the minimum funding levels next year if market volatility continues. 30/11/2002 Guardian Delay angers the critics. The Chancellor has angered critics of his pensions strategy by deferring a review of occupational pensions schemes which was scheduled for his pre-budget statement until December. Critics say that he is failing to tackle a growing pensions crisis, and that every day he fails to tackle cuts in employers' funding of occupational pensions contributes to the crisis. There are also fears that the movement towards means-tested benefits to support pensions will create an overly complex system which will deter people from claiming. 30/11/2002 Guardian Put them out of their misery. A leading pensions expert claims that Equitable Life should sell off its remaining businesses and pay its members their investments with a 20% cut rather than simply staggering on into bankruptcy. His view is that Equitable's recent figures showing a 70% decline in surplus assets is a signal of a slide into insolvency which should be confronted sooner rather than later. 07/12/2002 Guardian New hope on annuity rates. Many pensions experts believe that the government's plans to increase borrowing could cause annuities to become a more attractive option. It is, however, uncertain how much more attractive they will become, and when this will happen. Some experts expect a 0.5% increase in annuity rates over the next year, but increases in life expectancy and other factors could negate this rate increase. 08/03/2003 Daily Telegraph Will pensions be Labour's poll tax?. Frank Field's article draws attention to the first signs of a crisis of very significant proportions. Company pension schemes are being wound up and the retirement income of someone retiring now is about half that of someone who retired three years ago. Five years ago Britain had the most secure retirement funding of the EU - now many company pension schemes are imploding. Meanwhile personal pension values are shrinking as share prices fall.