Don't let your employer take your pension

The big mistakes were made decades ago, when companies (and countries!) promised free-for-all pensions that they then failed to fund appropriately, or in some cases, at all. The money isn't there but the promises still are. Money can't be plucked out of thin air so promises will have to be broken. Expect tears.

Is this the same Steve Webb that has unscrupulously shifted index-linking for many private and all public sector scheme members from RPI to the discredited CPI? If so, where has his halo suddenly appeared from?!!! I'd read the small print extremely closely with this man if I were you.

Pensions have been a scandal ever since Gordon Brown removed the investment tax benefit and took £5billion a year out of final salary schemes, so starting the rot.

Many Companies took pension holidays in the good years forgetting that the the good year balanced the bad years. Once a few companies closed their schemes, others saw they could also get away with it and followed them.

Labour did not discourage the closing of schemes as they favour dependancy in the population.

It never ceases to amaze me how the press failed to highlight the issue (did they conspire?) so that ordinary people did not see what was happening until it was too late.

THEY GOT AWAY WITH IT!!!

To sgjhaghsdg

I am unconvinced this was a "mistake decades ago".

A big factor was the raging inflation of the 1970's which boosted the final salary pensions of those lucky folks, including me, who had begun their careers in the 1960's. My starting salary was less than £500 a year (a YEAR) and it is inflation which has wrecked the pension trustees' calculations as they now pay me a pension substantially more than that every month!

All those years ago when pension schemes were set up there was a limited life expectancy for males - and it was males who were the majority of fund members in the generation before gender equality legislation.

It is the actuaries who are fault in catching up with the times as the numbers of female fund members rises, life expectancy increases, and inflation boosts entitlements.

Companies start by cheating their employees. Then they cheat their pensioners. Then they cheat their suppliers. Finally they cheat their customers.

After that they sell off their assets, de-merge and disappear. All in the pursuit of

'shareholder value'.

If you don't believe this, ask yourself what happened to our car industry, our chemical industry, our steel industry. Why do these industries still thrive in Germany and France??

The answer is simple. Their owners and managers are more competent, more far-sighted and value thair employees more.

Our equivalents are fat, lazy and complacent.

For the many class warriors out there who are programmed to automatically blame the workers, Let them consider why it is that British workers are building more and better cars than ever before.

Again the answer is simple.

SAME WORKERS..........BETTER, MORE ENLIGHTENED MANAGERS AND OWNERS.

I agree whole heartedly with everything James O,Donnell has said. I was one of those who got cheated many times. I ended up working in a sweat shop. However management made one move too far, and trod on the toes of a French company who were market leaders. They duly made an offer for the business which was too good to refuse. It was the best thing that happened to me. They changed the culture of the place and treated their employees fairly. The reduction in staff turnover was dramatic. I liked working for the French and fortunately for me I am now able to enjoy their generous pension too.

Local Government pension scheme members are being told they may have to pay double the contributions they do now, work up to 8 years longer for the same benefit, then it will be linked to CPI, not RPI. In addition out pension fund will no longer be ringfenced, so that money from our pension scheme could be used to pay for council services like bin collection. Any other type of investment we could probably sue them for breach of contract. The average staff member comes out with something like £4k per annum.

The trouble with the FSA is that they assume that words like "Final Salary" "Long term valuable benefits" means guaranteed.

Private Final Salary schemes are NOT guaranteed, they rely soley on a private wealth creating company making healthy profits from which they can fund it. No profits, no pension!

The FSA also assumes that the benefit structure of a final salary scheme is right for every member when they are patently not.

Yes there is the PPF but that is seriously short of cash and will most probably reduce its protection levels.

Unlike public sector Final Salary pensions where the goverment can simply raises taxes or steal £5 billion plus every year from private pensions to fund to fund them

Private Final Salary pensions should come with a serious health warning that says nothing is guaranteed despite what the FSA says.

ThIs Government has stolen mine and my wifes by increasing state pension age to 66. Thats 7 years worth of pension we wont be getting that people born before 1953 get.

Day light robbery.

Ted - I suspect Steve Webb`s halo was acquired for a knock down price based on the difference, over a 20-25 year period (life expectancy as pensioner), between RPI & CPI. A halo with spin - got to be worth a pat on the back from Cameron!

Lets Face It wrote "ThIs Government has stolen mine and my wifes by increasing state pension age to 66. Thats 7 years worth of pension we wont be getting that people born before 1953 get.

Day light robbery."

Did it ever occur to you that people born before 1953 won't live as long as you? That means that they won't get 7 years of pension because they will die! Your wife will probably live to 90 if she is in good health ... stop whingeing, wake up and smell the coffee!!

PS I will be 65 in 2020 so am caught by the changes. Unlucky perhaps, but certainly not unfair.

David

You must be brain washed if you really believe that anybody born after 1953 is going to live any longer than someone born before 1953.

I agree that statistically the average age of death is getting older due to technology and good standards of living but the genes remain the same. The average age of death is more likely to decline as our standard of living and affordability of technology declines.

The govenment have used the statistics to brain wash people like you into believing such things, I'm not against it as they need to fund it but to make it fair they should tax people more that are born before 1953, then it would be fair!

You are quite wroing "Lets Face It".

Many of us lucky enough to receive a state retirement pension at 65 were born in an era where there was no NHS. Our life expectancy is not as good as those born later.

LFI, What do you do for a living? I do pensions for a living and I know what I am talking about!

When state pension was introduced in 1908 only a small number of people lived long enough to receive it, As recently as 1977 (when I started in pensions) a man of 65 could expect about 12 years of state pension. Today he can expect more than 24 years: i.e. more than twice as much!!

Kid yourself that you are being ripped off .... maybe even let yourself be brainwashed by your mates in the pub, or by a journalist with about 30 years less experience than I have.

But please don't assume that I am as ignorant of this subject as you clearly are!!

those who want to post on a public forum should perhaps try to restrict themselves to a real discussion of the arguments and not degenerate into personal abuse.

Who knows how long any of us will live. At one minute they say we will live longer, the next we are all shortening our lives by being too fat, no exercise etc, so we don't actually know.

Those of us who have tried to plan for our retirement by working, saving our cash as much as possible and paying into pension schemes are likely to be upset when just as we are nearly there, the government moves the goalposts and it's too late too change what is already done. - especially when there are care fees to consider [our parents and our own], kids to help through college all at the same time. Some have taken early retirement [eg because of redundancy], hoping they can manage for a few years until they get their state pension, then suddenly find there are 4, 5 or six extra years.

IFAs don't generally make good pensions experts! They are too focused on what they get paid! If they claim they have been in pensions for 30 years what they mean is they have sold various pension vehicles for 30 years primarily designed to reward them, e.g. up to 1% trail commission!

www.pensionsmanager.blogspot.com

PM,

I don't think you should tar us all with the same brush.

After passing two exams of the Institute of Actuaries I decided that the CII offered a better option for me. I passed 9 papers to get my ACII and a further 5 to become a Fellow. Subsequently I passed the Financial Advisers Competency Test, Pensions exams G60, K10 and K20 and the 'Simplification' exam CF9 as well as the Investment paper G70.

My previous experience includes 10 years with one of the UK's leading Benefit Consultancies and 3 years doing training for a major Life Office. In the last 10 years at Intelligent Pensions I have been wholly fee-based, with no dependance on commission.

I am currently providing a series of 'Gap-Fill' seminars for the PFS, having previously been senior examiner for the CII on three pensions subjects, as well as tutoring on 6 different subjects and writing course material as well.

I come on here and make what I hope are helpful comments - indeed I am often asked by Citywire to provide responses to some of the more difficult queries.

My reward? Two people who do not have the b*lls to use their own names come on here anonymously to make totally unfounded accusations that I am either brain-washed or a commission chaser.

I am sure that Citywire will understand if I now choose to confine my comments to places where they are respected as befits my standing in the pensions community.

David, I agree with you - you seem one of the few good chaps. That's why I said IFAs don't generally make good pensions experts. And that's true. Your qualifications obviously make you a good all rounder, but despite your company name, you are focused on IFA/Life office end of the spectrum. I am focused on occupational pensions and better outcomes for consumers.

Stephen Tiley AKA PensionsManager

If this pensions minister is so concerned about unscrupilous behaviour perhaps he best look at what his government by considering Lord Huttons proposals will do to public service sector pensions.Oh and by the way MP's and judges are excluded from these changes.

The overwhelming problem is that when pension promises were made, they all underestimated increasing life expectancy and failed to take into account falling investment returns, and the fact that a lower birth rate and increased productivity means that there are fewer people to pay the pensions of an increasing number of pensioners.

That applies right across the board from public and private sector occupational pensions to personal pensions and savings. Most of us have not paid enough for the pensions we expect or are actually receiving. The only way to catch up is for people to pay more for their pensions or for benefits to be cut. The real villains - or incompetents - are the actuaries. I would sooner ask a bookmaker what my life expectancy is likely to be than an actuary!

So are we to believe that during the Pension Holiday periods that many UK companies enjoyed, not one actuary saw the "living longer" blackhole on the horizon? Or were their warnings ignored or worse still, suppressed?

Any retired CEO`s & or Finance Directors out there prepared to comment?

Ahh yes Lorna....your comment reminds me of the definition of an actuary: someone who finds accountancy too exciting!

I would sooner ask a crocodile to recommend a safe place to swim than a pensions adviser for a safe place to put my money. Either way, someone is going to feed, and someone else is going to bleed. Guess which in each case?