|
archived news blog
May 2012 (26)
April 2012 (39)
March 2012 (49)
February 2012 (42)
January 2012 (44)
December 2011 (33)
November 2011 (47)
October 2011 (42)
Final salary pensions under threat. Pearson May News Update - Tuesday 18 August
- Inheritance tax interest charge part of ‘fairer’ system, says HMRC
- Final salary pensions under threat
Final salary pensions under threat
A half of the final salary pension schemes still in operation in the private sector face closure by 2012.
A new survey of over 250 employers has found that some 50 per cent believe that they will shut their defined benefit schemes to all employees, existing as well as new, within the next three years.
As a result, up to a million employees will be moved to defined contribution schemes.
At the moment, 75 per cent of companies have closed their final salary schemes to new workers, but just 9 per cent have so far closed them to employees who were already members.
That figure is expected to balloon in the coming few years as firms battle with huge fund deficits. The Pension Protection Fund has estimated that the overall deficit among the UK’s 7,400 private sector schemes has now hit £158 billion.
Aside from the 50 per cent who plan to shut their schemes completely, 28 per cent intend to maintain their defined benefit schemes for existing employees but on less generous terms.
Final salary schemes provide employees with a retirement income calculated according to the length of time they have been members of the scheme and their salary at the point of retirement.
Defined contribution schemes, however, offer no such guarantee, and the retirement income they deliver depends on how well the fund has fared on often volatile stock markets.
Business General
This section contains a host of advice and information on a range of business matters, from insuring your
business to dealing with employee absence. Simply visit the topics listed below for further information,
ideas, tips and strategies on how to take your business forward.
Click here for more information
See What's On Our Site
Our site also contains:
- A huge database of business information
- Your portal to the web with our powerful search facilities and Links section
Home | Contact Us | Recruitment | Services | News | Knowledge Centre | International
About Us | Companies House Search | Links | Search | Register | Logout
Terms
and Conditions
Technical Problems - email service@pearsonmay.co.uk
Copyright © 2009 Pearson May. All rights reserved.