A paper said that although there were marked differences between elderly men and elderly women in their lifetime employment histories, these differences accounted for only a small fraction of the overall private pension income gap between the sexes. The overall gender gap arose mainly because women s characteristics were less well rewarded than men s, rather than because women had less advantageous personal characteristics than men.
Source: Elena Bardasi and Stephen Jenkins, The Gender Gap in Private Pensions, Working Paper 2004-29, Institute for Social and Economic Research/University of Essex (01206 873087)
Links: Working paper (pdf)
Date: 2004-Dec
A trade union report on the retirement crisis said that young women starting work in 2004 were as likely to be as poor in old age as their great-grandmothers were. The time young women took off to care for children, combined with wages still nearly 20 per cent lower than those of men, meant they were less likely than men to be able to save for old age.
Source: Time for Action: Women and pensions, Trades Union Congress (020 7467 1294)
Links: Report (pdf) | TUC press release | Guardian report
Date: 2004-Dec
A review report said that the actuarial profession had been too insular and slow to adapt to changing circumstances; that there had been insufficient transparency in actuarial advice; that there had been inadequate scrutiny, challenge and market-testing of actuarial advice by users (such as some pension fund trustees and Boards of insurers); and that there had been a lack of clarity about the accountability of actuaries to the wider public interest.
Source: Morris Review of the Actuarial Profession: Interim Assessment, HM Treasury (020 7270 4558)
Links: Report (pdf) | HMT press release | IOA press release | GAD press release (pdf)
Date: 2004-Dec
An interim report said that a simple new citizen s pension, worth 105 a week, could be introduced by 2010. It would replace the existing 'tangle' of state provision with a single, universal, flat-rate payment. Some 8 million pensioners who received less than 105 a week from the state would immediately gain.
Source: Towards a Citizen s Pension: Interim report, National Association of Pension Funds (020 7808 1300)
Links: Report (pdf) | NAPF press release | Mercer press release
Date: 2004-Dec
A taskforce report into occupational pension schemes (headed by Peter Davis) warned that action was needed if the existing voluntary system were to be preserved. Unless the decline in adequate employer-led pension provision could be stopped, and increased savings from both employers and employees delivered through the voluntary framework, the government might be forced to look at more drastic solutions such as compulsory contributions.
Source: Report to the Secretary of State for Work and Pensions, Employer Task Force on Pensions (0845 731 3233) | House of Commons Hansard, Written Ministerial Statement 13 December 2004, columns 115-116WS, TSO (0870 600 5522)
Links: Report (pdf) | Hansard | DWP press release (1) | DWP press release (2) | NCC press release | NAPF press release | CBI press release | Mercer press release | Guardian report
Date: 2004-Dec
The government began consultation on proposals to change the civil service pension arrangements. The existing final-salary scheme would be replaced with a pay-as-you-go scheme, and the pension age would be raised to 65.
Source: Building a Sustainable Future: Proposals for changes to the civil service pension arrangements, Cabinet Office (020 7261 8527)
Links: Consultation document (pdf) | Summary | Guardian report
Date: 2004-Dec
The government published the conclusions of its review into how effective the 'Myners' principles had been in improving investment decision-making by pension schemes. It said that there had been positive progress, but that more needed to be done. It proposed further measures to ensure that those taking investment decisions were familiar with investment issues. (In 2000 Paul Myners reported on factors distorting institutional investment decisions.)
Source: Myners Principles for Institutional Investment Decision-making: Review of progress, HM Treasury (020 7270 4558)
Links: Report (pdf) | HMT press release | NAPF press release | Mercer press release
Date: 2004-Dec
A think-tank pamphlet said that the government's pensions policy was unsustainable, and that the growth in the means-testing of pensions should be reversed.
Source: Paul Thornton, Jonathan Gardner and Mike Orszag, The Pensions Predicament: Means testing, the savings trap and the labour market, Politeia (020 7240 5070)
Links: Summary
Date: 2004-Dec
The government began consultation on the requirements for pension provision where there had been a business transfer to which the Transfer of Undertakings (Protection of Employment) (TUPE) Regulations applied.
Source: The Transfer of Employment (Pension Protection) Regulations 2005: Draft regulations, Department for Work and Pensions (020 7962 8176)
Links: Consultation document (pdf) | DWP press release
Date: 2004-Dec
The government announced that underfunded pension schemes that started winding up between 1 January 1997 and 5 April 2005 (when the Pension Protection Fund would come into operation) would be potentially eligible for help from the Financial Assistance Scheme.
Source: House of Commons Hansard, Written Ministerial Statement 2 December 2004, columns 64-66WS, TSO (0870 600 5522)
Links: Hansard | DWP press release
Date: 2004-Dec
A report said that there were sound, and still valid, reasons for introducing contracting-out of the state second pension, notably the protection of occupational pension schemes and the encouragement of private pension saving. The abolition of contracting-out would not create additional money to fund additional state pensions: rather it would defer government expenditure to a later point in time, with the next generation of workers potentially having to meet this expenditure.
Source: Julie Stark, Making Saving Pay: The case for reforming contracting out of the state second pension, Association of British Insurers (020 7600 3333)
Links: Report (pdf) | ABI press release
Date: 2004-Dec
A survey (the first of a new quarterly series) found that the groups who saved the most as a percentage of income were single people, part-time workers, and (particularly) those aged 16-24.
Source: Press release 8 December 2004, National Savings and Investments (020 7348 9301)
Links: NSI press release
Date: 2004-Dec
Statistics were published on membership of the state earnings related pension scheme/state second pension since people were first permitted to contract out in 1978-79. The number of people with some form of second-tier cover in 1978-79 stood at nearly 18 million: by 2002-03, this had increased to nearly 26 million.
Source: Second Tier Pension Provision 1978/79 to 2002/03, Department for Work and Pensions (020 7962 8176)
Links: Report (pdf)
Date: 2004-Dec
A survey found that more than three-quarters of employers with final salary pensions expected to face future funding difficulties.
Source: Thirtieth Annual Survey of Occupational Pension Schemes, National Association of Pension Funds (020 7808 1300)
Links: NAPF press release | Guardian report
Date: 2004-Nov
Judges reportedly threatened mass resignations unless they were exempted from a 1.5 million cap (for tax purposes) on the capitalized amounts in an individual's pension fund, due to come into effect in April 2005. Plans for a Judicial Pensions Bill were included in the government s legislative programme for the Parliamentary year 2004-05 (Queen's Speech): the Bill would maintain the existing level of judges' pensions, at no additional cost to the public purse overall.
Source: The Guardian, 27 November 2004 | House of Lords Hansard, Queen's Speech 23 November 2004, columns 1-4, TSO (0870 600 5522) | House of Commons Hansard, Debate 25 November 2004, columns 246-330, TSO
Links: Guardian report | Text of Speech | Lords Hansard | Commons Hansard
Date: 2004-Nov
Researchers found that only 59 per cent of working-age respondents said they were aware of the future increase in the state pension age for women. Only 43 per cent of women who would be affected by the increase knew their own state pension age - of these, knowledge was lowest among women more likely to have to rely on the state pension in retirement.
Source: Claire Murphy, Public Awareness of State Pension Age Equalisation, Research Report 221, Department for Work and Pensions (0113 399 4040)
Links: Report (pdf links) | Summary (pdf) | DWP press release
Date: 2004-Nov
A report said that up to 10 million migrant workers might need to enter the United Kingdom by 2025 in order to ensure that pensioners could continue to receive 80 a week from the basic state pension.
Source: David Blake and Les Mayhew, Immigration or Bust: Securing the future viability of the basic state pension, Pensions Institute/City University (020 7040 8600)
Links: Report (pdf) | Guardian report
Date: 2004-Nov
A report said that under-saving extended across all age groups, income bands and the genders and was no longer a phenomenon of the traditional under-saving groups, such as women and self-employed people.
Source: Julie Stark, The State of the Nation s Savings 2004, Association of British Insurers (020 7600 3333)
Links: Report (pdf) | ABI press release | Guardian report
Date: 2004-Nov
A government minister reportedly admitted that the pension credit was suffering from 'a take-up problem', and might act as a disincentive to save for some people.
Source: The Guardian, 3 November 2004
Links: Guardian report
Date: 2004-Nov
The Pensions Act received Royal assent. The Act provided for the creation of a Pension Protection Fund (to protect members of defined pension schemes whose schemes became insolvent) and the establishment of a Pensions Regulator.
Source: Pensions Act 2004, TSO (0870 600 5522)
Links: Text of Act | DWP press release | OPRA press release | CBI press release
Date: 2004-Nov
A think-tank report called for a dramatic simplification of the state pension system. An enhanced basic state pension was the best way to tackle pensioner poverty while providing an environment in which people could plan with confidence and be rewarded for saving. This could be achieved at no extra cost in the medium term, if the state second pension and its associated rebates were phased out.
Source: Peter Robinson, A New Contract for Retirement, Institute for Public Policy Research, available from Central Books (0845 458 9911)
Links: IPPR press release
Date: 2004-Oct
The government published the results of its consultation with the pensions industry on the moral hazard clauses in the Pensions Bill. The report set out the amendments to the Bill designed to clarify the clauses and address industry concerns. (Moral hazard is the risk that, because the Pension Protection Fund would compensate scheme members if their employer became insolvent and the scheme was under funded, employers would deliberately manipulate their affairs so as to shift their deficits to the Fund.)
Source: Consultation on the Moral Hazard Clauses in the Pensions Bill: Report for Grand Committee, Department for Work and Pensions (020 7962 8176)
Links: Report (pdf) | DWP press release | PwC press release
Date: 2004-Oct
A report said there was no evidence that tax incentives increased the overall level of saving. They were complex, did not appeal to their target group, and did not solve the basic problem for most low-income people - that they did not have the money to save. Tax incentives could encourage pension rather than other types of saving: but tax incentives appeared not to have been effective in generating enough pension saving for future pensioners.
Source: Chris Curry and Alison O Connell, Tax Relief and Incentives for Pension Saving, Age Concern England (020 8765 7200)
Links: Report (pdf) | Age Concern press release
Date: 2004-Oct
The government responded to a report by a committee of MPs on long-term savings.
Source: Responses to the Committee's Eighth Report: Restoring Confidence in Long-term Savings (HC 71), Eighth Special Report (Session 2003-04), HC 1119, House of Commons Treasury Select Committee, TSO (0870 600 5522)
Links: Response | MPs report
Date: 2004-Oct
A new book said although state pension schemes were sustainable, private schemes provided by employers and insurance companies were in 'deep trouble'. Suggestions that private pension saving could fill the gap left by an increasingly limited state pension were therefore unrealistic for the majority of the population.
Source: Martin Sullivan, Understanding Pensions, Routledge (01264 343071)
Links: Summary | Guardian report
Date: 2004-Oct
The first report was published of an official commission (chaired by Adair Turner) on pensions policy. It presented its conclusions on the adequacy of pension provision and saving; and it set out the major challenges society faced, and the unavoidable choices which needed to be made. It said that society and individuals had to choose some mix of four options: pensioners becoming poorer relative to the rest of society; taxes/national insurance contributions devoted to pensions rising; savings rising; or average retirement ages rising. The government reportedly ruled out tax rises to pay for increases in state pensions.
Source: Pensions: Challenges and Choices, Pensions Commission, TSO (0870 600 5522) | The Guardian, 20 October 2004 | House of Commons Hansard, Written Ministerial Statement 12 October 2004, columns 22-24WS, TSO
Links: Report (pdf) | Appendices (pdf) | Summary (pdf) | Commission press release (Word file) | Hansard | DWP press release | ONS press release (pdf) | CBI press release | Age Concern press release | Help the Aged press release | Guardian report (1) | Guardian report (2)
Date: 2004-Oct
A survey found that the number of companies that had closed their final salary pension schemes to new members had fallen dramatically in the previous two years, and was likely to continue to decline.
Source: 2004 UK Pension Scheme Survey, Mercer Human Resource Consulting (020 7963 3127)
Links: Mercer press release
Date: 2004-Sep
A paper on state pension reform highlighted the complexity of unwinding the existing means-testing policy, and concluded that pension reform should be undertaken sooner rather than later.
Source: Managing Transition, Pensions Policy Institute (020 7848 3744)
Links: Report (pdf) | PPI press release (pdf)
Date: 2004-Sep
The Inland Revenue published revised figures for the tax relief paid on pension schemes. Total tax relief in 2001-02 was around 9.4 billion, compared to the previous estimate of 13 billion.
Source: Approved Pension Schemes: Cost of tax relief, Inland Revenue (020 7438 6420)
Links: Report (pdf)
Date: 2004-Sep
A report said that women were not saving adequate amounts towards providing an income in retirement and, largely as a result of this, women were at greater risk of poverty in retirement. It made proposals targeted at smaller employers, who were traditionally least likely to run or contribute to a pension scheme which would be of particular benefit to women.
Source: The Gender Pensions Gap: Encouraging women to save for retirement, Association of British Insurers (020 7600 3333)
Links: Report (pdf) | ABI press release | Guardian report
Date: 2004-Sep
The government announced proposals to ensure that 50 per cent (rather than one third) of pension scheme trustees were member-nominated. The changes would form part of the Pensions Bill.
Source: Press release 14 September 2004, Department for Work and Pensions (020 7712 2171)
Links: DWP press release | Text of Bill | Explanatory notes | TUC press release | Guardian report
Date: 2004-Sep
An article presented preliminary estimates of total pension contributions from 1995 to 2002 on a new definition that embraced all private pensions. It said that these estimates showed substantial changes compared with previous statistics. Contributions to funded occupational pension schemes grew from 16 billion in 1995 to 27 billion in 2002; for 2002, this represented a significant downward revision of some 12 billion from previous estimates. But the estimates remained subject to a 'high degree of uncertainty'.
Source: Christina Forrest, Pauline Penneck and Geoff Tiley, 'Private pension estimates and the national accounts', Economic Trends, August 2004, Office for National Statistics, TSO (0870 600 5522)
Links: Article (pdf)
Date: 2004-Aug
A survey found that, out of various options for pensions reform, a system of compulsory employer and employee contributions was consistently the most popular. But only a minority of supporters of compulsion believed it would have a major impact on their own savings.
Source: Compulsory Pensions: An analysis of public attitudes, Association of British Insurers (020 7600 3333)
Links: Report (pdf) | ABI press release
Date: 2004-Aug
The government responded to a report by a committee of peers on aspects of the economics of an ageing population.
Source: Government Response to Aspects of the Economics of an Ageing Population, Second Report (Session 2003-04), HL 129, House of Lords Economic Affairs Select Committee, TSO (0870 600 5522)
Links: Response | Lords report
Date: 2004-Jul
Researchers explored the experiences of those participating in the 'combined pension forecasting' initiative, providing pension scheme members with state pension forecast information combined with a forecast of an individual s current occupational or private pension.
Source: Karen Bunt, Lorna Adams and Catherine Mottram, Combined Pension Forecasts: A report on the experiences and views of CPF providers and recipients, Research Report 212, Department for Work and Pensions (0113 399 4040)
Links: Report (pdf links) | Summary (pdf) | DWP press release
Date: 2004-Jul
Business leaders published a 22-point action plan designed to tackle the pensions crisis. It said the government should help low-paid workers by increasing the basic state pension to the level of the pensions credit, to reduce the need for means-testing: to help fund this the state pension age should gradually rise to 70 over the decade from 2020 to 2030. Trade unions said many of the proposals were 'wide of the mark'.
Source: Securing Our Future: Developing sustainable pension provision in the UK, Confederation of British Industry (020 7395 8247) | Press release 16 July 2004, Trades Union Congress (020 7467 1294)
Links: Summary | CBI press release | TUC press release | CIPD press release | Guardian report
Date: 2004-Jul
A paper recommended replacing the existing state pension system with a single flat-rate pension available to all, and providing tangible financial incentives to encourage employer contributions. Other recommended measures included gradually increasing the state pension age as longevity increased; and raising the minimum retirement age from 50 to 55 on a sliding scale before 2010.
Source: Revitalising the Pensions Partnership, British Chambers of Commerce (020 7654 5808)
Links: BCC press release
Date: 2004-Jul
A report highlighted the problem of under-saving among certain groups. Up to 3 million people were seriously under-saving for retirement; and up to 10 million might need to save more, work longer, or both. At the same time, a substantial minority did not participate either in occupational or personal pensions often for genuine reasons, such as low income.
Source: Labour Research Department, Who Is Under-saving for Retirement?, Age Concern England (020 8765 7200)
Links: Report (pdf) | Age Concern press release
Date: 2004-Jul
Researchers looked at how occupational pension scheme trustees took investment decisions; and how practices had changed in line with investment decision-making principles set out in the 2001 Myners Report. On average, trustees spent just 10.6 hours per year in board meetings. Only 25 per cent of schemes said their trustees took part in formal training programmes other than induction training.
Source: Sarah Horack, John Leston and Margaret Watmough, The Myners Principles and Occupational Pension Schemes: Volume 2 of 2 Findings from quantitative research, Research Report 213, Department for Work and Pensions (0113 399 4040)
Links: Report (pdf links) | Summary (pdf) | DWP press release (pdf)
Date: 2004-Jul
An article discussed the implications of the decline of the national insurance system, under governments of both the Left and the Right. But there were also reasons why the system had not been swept away, notably the way in which most of it concerned already accrued state pension rights. The article suggested a way in which a more transparent system could guarantee a total state pension at a fixed percentage of average earnings. Either other national insurance benefits could be separated from pensions and absorbed within other working age social security, or the scope of national insurance could be maintained - but based on a test of participation, not past contributions.
Source: John Hills, 'Heading for retirement?: National insurance, state pensions, and the future of the contributory principle in the UK', Journal of Social Policy, Volume 33 Issue 3
Links: Abstract
Date: 2004-Jul
A report sought to 'dispel the myths' around fixed retirement ages. It argued that scrapping them would show the ability of the nation to transform retirement, and ensure business could make the most of older people s talent with clear, easily implemented laws.
Source: Choose, Not Lose, the Right to Work: The case for scrapping mandatory retirement ages, Age Concern England (020 8765 7200)
Links: Report (pdf) | Age Concern press release
Date: 2004-Jul
The government responded to a report by a committee of MPs on mis-selling of endowment mortgages. It said that it supported moves by the financial services regulator to carry out research into the size and extent of the shortfalls facing consumers.
Source: Responses to the Committee's Fifth Report: Restoring confidence in long term savings - Endowment mortgages (HC 394), Fifth Special Report (Session 2003-04), HC 655, House of Commons Treasury Select Committee, TSO (0870 600 5522)
Links: Response | MPs report | Consumers' Association press release
Date: 2004-Jun
The government began consultation on proposed regulations for the 'stakeholder suite' of simple, low-cost, risk-controlled savings and investment products (following the recommendations of the Sandler review of retail financial services in July 2002). The Treasury announced, following an independent research report, that the annual management charge would be capped at 1.5 per cent for the first 10 years that a product was held (after having previously proposed a cap of 1 per cent).
Source: Consultation on 'Stakeholder' Saving and Investment Products Regulations, HM Treasury (020 7270 4558) | House of Commons Hansard, Written Ministerial Statement 17 June 2004, columns 52-54WS, TSO (0870 600 5522) | Deloitte, Assessing the Likely Market Impacts of Charge Caps on Retail Investment Products, HM Treasury
Links: Consultation document (pdf) | Hansard | HMT press release | Deloitte report (pdf) | NCC press release | Consumers' Association press release | Guardian report
Date: 2004-Jun
The government announced that indexation would be removed from defined-contribution pension schemes, by an amendment to the Pensions Bill. It said the change would represent a 'significant simplification' for schemes, by removing complications caused by several different indexation regimes.
Source: Press release 11 June 2004, Department for Work and Pensions (020 7712 2171)
Links: DWP press release
Date: 2004-Jun
Researchers assessed how the introduction of unisex rates would affect the annuities market. They concluded that the introduction of unisex annuities was unlikely to be of widespread and significant benefit. The Equal Opportunities Commission said that sex discrimination laws should be tightened up, so that insurers could only offer women and men different rates if they had relevant and up-to-date data to justify the difference.
Source: Chris Curry and Alison O'Connell, An Analysis of Unisex Annuity Rates, Equal Opportunities Commission (0161 833 9244) | Press release 30 June 2004, Equal Opportunities Commission
Links: Report (pdf) | Summary (pdf) | EOC press release
Date: 2004-Jun
An article said that recent reforms to employer-sponsored company pension schemes were likely to reinforce income insecurity.
Source: Mark Hyde and John Dixon, 'Working and saving for retirement: New Labour s reform of company pensions', Critical Social Policy, Volume 24 Number 2
Links: Abstract
Date: 2004-May
A third reading was given to a Bill proposing a protection fund to help workers whose pension fund became insolvent. The government tabled an amendment to the Bill, to help workers who had previously lost out in pension wind-ups: it proposed to establish a special fund for the purpose, with 400 million of public money to be paid in over 20 years.
Source: Pensions Bill, Department for Work and Pensions, TSO (0870 600 5522) | House of Commons Hansard, Debate 20 May 2004, columns 1118-1195, TSO | House of Commons Hansard, Written Ministerial Statement 14 May 2004, columns 32-34WS, TSO
Links: Text of Bill | Explanatory notes | Third reading | Ministerial statement | DWP press release | TUC press release | Mercer press release | Guardian report
Date: 2004-May
The government tabled regulations (operative from 10 May 2004) designed to ensure that when an occupational pension scheme was wound up, the assets were shared more equally between pensioner and non-pensioner scheme members. It said that many non-pensioner scheme members stood to gain up to 20 per cent of their pension as a result.
Source: The Occupational Pension Schemes (Winding Up) (Amendment) Regulations 2004, Statutory Instrument 2004/1140, Department for Work and Pensions, TSO (0870 600 5522) | Press release 19 April 2004, Department for Work and Pensions (020 7712 2171)
Links: Text of Statutory Instrument | DWP press release | Mercer press release
Date: 2004-Apr
A report said that the government should develop a campaign to raise awareness of, and interest in, long-term saving among young people.
Source: Young People and Pensions: Engaging the under 30s, Association of British Insurers (020 7600 3333)
Links: Report (pdf) | ABI press release
Date: 2004-Apr
Research found that many people entering retirement felt let down and disillusioned by the state pension. Those who tried to save extra for their retirement felt powerless because their pensions and investments had not lived up to their promises. Only those lucky enough to have a final-salary pension felt really confident about their future. The report called for everyone to be given the right to a basic state citizen pension.
Source: Meg Gay, Retirement Realities: Shocked and struggling, National Consumer Council (020 7730 3469)
Links: Report (pdf)
Date: 2004-Mar
A think-tank pamphlet made proposals to overcome the 'savings crisis' - including better education, simplification of savings schemes, and a wider role for employers. The key measure was to massively increase the basic state pension, while raising the retirement age.
Source: Alan Pickering, How Government Can Get Us Saving Again, Adam Smith Institute (020 7222 4995)
Links: Report (pdf)
Date: 2004-Mar
The number of people with second-tier pension provision (contracted-out pension scheme membership or state earnings-related pension) rose from 17 million people in 1978-79 to 21.6 million by 2000-01. In 1978-79 SERPS accounted for 48 per cent of all second-tier pension cover; this reached a low of 31 per cent in 1992-93, then increased again to 38 per cent by 2000-01.
Source: Second Tier Pension Provision 1978/79 to 2000/01, Department for Work and Pensions (020 7962 8176)
Links: DWP press release (pdf)
Date: 2004-Mar
The Trades Union Congress called on the government to abolish the '25 per cent' rule that stopped people with fewer than 10 years contributions getting any state pension. There were around 100,000 people, 88 per cent of whom were women, who although they had paid contributions, never got anything in return because of the rule.
Source: Women and Pensions, Trades Union Congress (020 7467 1294)
Links: Report | TUC press release
Date: 2004-Mar
A report said that research had found 'grave doubts' over the government's ability to provide an adequate state pension; low levels of trust in the financial services industry; and strong opposition to the means testing of pensions. It said that forcing people to work longer was not the answer to the pensions crisis. The real alternative could be a new, flexible approach to retirement that both transformed the experience of old age and brought 'ripple down' benefits for future generations of younger workers.
Source: Michael Moynagh and Richard Worsley, The Opportunity of a Lifetime: Reshaping retirement, Tomorrow Project (01328 730297) and Chartered Institute of Personnel Development
Links: Summary (pdf) | CIPD press release
Date: 2004-Mar
The government announced (in the Budget) plans to simplify the taxation of pensions, replacing eight separate regimes from April 2006 with a single, simplified regime with a lifetime allowance for tax-privileged pension saving. It said it would set the lifetime allowance on introduction to reflect an April 2006 implementation date; to provide certainty, it would pre-announce the lifetime allowance for all years up to 2010 such that it increased steadily to 1.8 million in 2010; and it would review the lifetime allowance level and indexation every 5 years, with the first review in 2010. The National Audit Office said that the government's estimates of the number of people likely to be affected by the lifetime limit were reasonable.
Source: Prudence for a Purpose: A Britain of stability and strength - Economic and Fiscal Strategy Report and Financial Statement and Budget Report, HC 301, HM Treasury, TSO (0870 600 5522) | House of Commons Hansard, Debate 17 March 2004, columns 321-336, TSO | The Government's Estimates of the Impact of the Pensions Lifetime Allowance, National Audit Office (020 7798 7400)
Links: Budget report (pdf links) | HMT press releases | Budget speech | NAO report (pdf) | NAO press release | TUC press release | Guardian report
Date: 2004-Mar
A report presented the findings of the Employers Pension Provision survey 2003. Overall, 52 per cent of organisations provided some type of pension or pension access: 7 per cent provided occupational pension schemes (3 per cent among businesses with fewer than 5 employees, rising to 85 per cent in organisations with 1,000 or more employees). 35 per cent of employers provided access to stakeholder pensions: but three-quarters of these reported no active members among their workforce. 92 per cent of employees worked in organisations with some form of pension provision. The period between 2000 (the previous survey) and 2003 recorded a substantial increase in the proportion of employers offering some form of pension provision.
Source: Andreas Cebulla and Sandra De-Beaman, Employers Pension Provision Survey 2003, Research Report 207, Department for Work and Pensions (0113 399 4040)
Links: Report | Summary (pdf) | DWP press release
Date: 2004-Mar
An independent inquiry into the near-collapse of the life insurance and pensions company, Equitable Life, found that the former management had engaged in a series of 'dubious' financial practices, many of which it concealed from policyholders, the regulators and even its own board directors. Following publication of the report, the government commissioned two independent reviews: Paul Myners would lead a review into the corporate governance arrangements applicable to mutual life offices; and Sir Derek Morris would lead a wide-ranging review of the actuarial profession. It also requested that the Accounting Standards Board undertake an urgent study into the accounting for with-profits business by life insurers. But it said there was 'no reason to think that the regulator was negligent or that there was any maladministration at any time while the society was being regulated by the Treasury'.
Source: Lord Penrose, Report of the Equitable Life Inquiry, HC 290, HM Treasury, TSO (0870 600 5522) | Press release 8 March 2004, HM Treasury (020 7270 4558) | House of Commons Hansard, Debate 24 March 2004, columns 976-1024, TSO (0870 600 5522)
Links: Report (pdf links) | Hansard | HMT press release | FSA press release | Equitable Life press release (pdf) | Guardian report
Date: 2004-Mar
A think-tank paper said that the pension system in the United Kingdom appeared to be as sustainable as it did because it would become increasingly less generous and increasingly reliant on means-testing. If people responded by reducing private savings, this could push a greater burden on to the state.
Source: Pensions, Pensioners and Pensions Policy: Financial security in UK retirement savings?, Briefing Note 48, Institute for Fiscal Studies (web publication only)
Links: Briefing Note (pdf)
Date: 2004-Mar
A report by a committee of MPs said the sale of endowment mortgages had damaged public trust in the financial services industry. Insurers had comprehensively failed homebuyers, with firms guilty of a catalogue of failings.
Source: Restoring Confidence in Long-term Savings: Endowment mortgages, Fifth Report (Session 2003-04), HC 394, House of Commons Treasury Select Committee, TSO (0870 600 5522)
Links: Report | Guardian report
Date: 2004-Mar
A second reading was given to a Bill proposing a protection fund to help workers whose pension fund became insolvent.
Source: Pensions Bill, Department for Work and Pensions, TSO (0870 600 5522) | House of Commons Hansard, Debate 2 March 2004, columns 761-869, TSO
Links: Text of Bill | Explanatory notes | Hansard
Date: 2004-Mar
The government announced (in the Budget) that it would introduce the option of taking a deferred state pension as a taxable lump sum instead of higher weekly pension payments. Those choosing to defer their state pension by at least one year from April 2005 would be able to take the lump sum. Interest would be payable on the deferred pension (for those choosing the lump sum) at Bank of England base rate plus 2 per cent.
Source: Prudence for a Purpose: A Britain of stability and strength - Economic and Fiscal Strategy Report and Financial Statement and Budget Report, HC 301, HM Treasury, TSO (0870 600 5522) | House of Commons Hansard, Debate 17 March 2004, columns 321-336, TSO
Links: Report (pdf links) | HMT press releases | Budget speech
Date: 2004-Mar
A paper looked at the internal governance of pension funds, emphasising the role of codes of practice, the rules and procedures for decision-making, and trustee competence and expertise. It concluded that the governance of pension fund institutions reflected, more often than not, its nineteenth century antecedents rather than the financial imperatives of the twenty-first century.
Source: Gordon Clark, Pension Fund Governance 1: Expertise and organizational form, WPG 04-02, School of Geography and the Environment/University of Oxford (01865 271922) and Sa d Business School/University of Oxford
Links: Paper (pdf) | Abstract
Date: 2004-Feb
Researchers found high levels of customer satisfaction with the Pensions Service.
Source: Nicholas Howat, Graham Kelly, Bridget Williams and Rebecca Scheer with Susan Kay, The Pension Service Customer Survey 2003, Research Report 205, Department for Work and Pensions (0113 399 4040)
Links: Report (pdf links) | Summary (pdf) | DWP press release
Date: 2004-Feb
The government published a report setting out action being taken or planned to 'empower individuals to make real and informed choices on working and saving for retirement'. It announced a pilot scheme under which employees would be required to opt out of their occupational scheme, rather than opt in.
Source: Simplicity, Security and Choice: Informed choices for working and saving, Cm 6111, Department for Work and Pensions, TSO (0870 600 5522)
Links: Report (pdf) | Summary (pdf) | Annex (pdf) | DWP press release | Guardian report
Date: 2004-Feb
The government published a Pensions Bill proposing a protection fund to help workers whose pension fund became insolvent. Other measures included steps to simplify pensions administration for employers, and give a 'better deal' to those who deferred taking their state pension. A consumer body described the Bill as 'half-baked', and said the protection fund would not actually guarantee protection for pensioners without government financial backing.
Source: Pensions Bill, Department for Work and Pensions, TSO (0870 600 5522) | Press release 12 February 2004, Consumers' Association (020 7770 7000)
Links: Text of Bill | Explanatory notes | DWP press release (1) | DWP press release (2) | HOC research briefing (pdf) | Consumers' Association press release | CBI press release | Guardian report
Date: 2004-Feb
Researchers examined the effect of means-testing of benefits by developing a simulation of their effects on pensioners. Although targeting pension income at the less well-off did generate negative incentives for those on low incomes, it did not lower aggregate savings and work participation levels. This was because the incentive effects for the poor were offset by those for the rich. Increases in means-testing of pensions usually assisted low-income households at the expense of those on middle incomes, and current pension policy initiatives to limit the extent of means-testing probably struck an acceptable balance between economic distortions and redistributive social objectives.
Source: James Sefton, Justin van de Ven, Martin Weale and David Miles, Pensions Means Testing and Early Retirement, Economic and Social Research Council (01793 413000)
Links: Report (pdf) | Summary (pdf)
Date: 2004-Feb
A private member's Bill was introduced, designed to amend the complicated law relating to the purchase of annuities in respect of private and personal pensions. It would to give pensioners much greater flexibility over their choice of retirement income needs by limiting the requirement to buy an annuity, which would in turn have to provide a minimum retirement income.
Source: Adrian Flook MP, Retirement Income Reform Bill, TSO (0870 600 5522)
Links: ePolitix summary
Date: 2004-Jan
A private member's Bill was introduced, designed to create a universal funded second pension to replace the existing (largely unfunded) state second pension. Everyone, including the self-employed, would be required to have a pension fund into which they would make payments throughout their working lives sufficient to provide an income in retirement, which, together with their basic state pension, would enable them to avoid being dependent on means-tested benefits
Source: Peter Lilley MP, Universal Funded Pensions Bill, TSO (0870 600 5522) | House of Commons Hansard, Debate 21 January 2004, columns 1326-1328, TSO
Links: Hansard | ePolitix summary
Date: 2004-Jan
A survey found that 9 out of 10 people who applied for the new pension credit were happy with the application process and the service received.
Source: Continental Research, DWP Pension Credit Application Line Customer Satisfaction, Department for Work and Pensions (020 7712 2171)
Links: Report (pdf) | DWP press release
Date: 2004-Jan