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The not-so-golden years

Thousands of Scots face decades of poverty in retirement.
More than four out of ten questioned by Scottish Widows admitted they hadn't considered how they would survive when they gave up work. Almost as many optimistically said they would look to their children for financial support, while one in seven expected the state to cover their costs.
According to Aviva, 50 to 65 year olds underestimate the length of their retirement by up to eight years. Women put the average lifespan for a reasonably healthy person at 84 years, while men say it is 80, but they could well live to 89 and 88 respectively.
A survey by HSBC found that despite almost six out of ten UK workers worrying they won't have enough to retire on, the economic downturn has prompted more than four out of ten to cut their pension savings or stop altogether. Just over half of those taking part in the HSBC survey said they simply couldn't afford to save enough and a third said paying off debts was preventing them.

Too young to die, too old to live

There's no question that the population's aging is of major importance, and that it will change the whole tenor of social life health care, the consumer culture, architecture, living arrangements, and even population sex ratios, since women live longer than men. But the real crisis for capitalism and its governments is that the costs of health care and pensions will grow, something that's usually presented as a "burden" on the non elderly members of society. Older people are not to be cared for, even cherished they're a cost that has to be minimised in the name of fiscal prudence, growth, and productivity. Unless older people are to starve, some provision for their income must be made. In pre -industrial societies, where life is short, people tend to work until they can no longer, and then their families take over. With industrialisation families break apart, and such informal arrangements can no longer be relied on.

According to the doomsters, there are man…

A nice little nest-egg

Always the first to attack workers’ pensions rights, the capitalist class have one rule for us and another for themselves.
James Crosby and Andy Hornby – two of the three former HBOS chiefs damned by a parliamentary commission for “catastrophic failures of management” – were on pension schemes that accrued benefits at twice the rate of average workers.
The “executive section” of the HBOS pension scheme allowed them to pocket 1/30th of their final salary for each year they worked at the firm, compared with 1/60th for front-line staff.Hornby, eligible to start drawing down a £240,000-a-year HBOS pension when he turns 50 in four years time.

Ged Nichols, general-secretary of the Accord union, which represents HBOS staff, said the pension arrangements were “absolutely disgusting”. He said: “Even with James Crosby reducing his pension, for a front-line member of staff, they would still have to work for more than 20 years to get what Mr Crosby and some of the other former directors get as …

Old and in the way?

160,000 pensioners in Scotland are living in relative poverty – with an income of less than 60 per cent of the national average. Prices for pensioners have risen 20 per cent since the beginning of the financial crisis. By contrast, inflation for UK households as a whole prices have risen 16 per cent. An older person living alone is said to have experienced a 26.5 per cent increase in the cost of the things they buy since 2007 when the current financial crisis began.

 Today’s pensioners are experiencing real hardship, with nearly half living on an income below £10,000 a year. Those with private pensions have experienced a worrying drop in the value of their pension because of low interest rates, which are being held down by the Bank of England’s policy of quantitive easing.
Age Concern Scotland said: “For older people who are living on a low, fixed income, life can be tough, with basic living costs such as food and energy still high and April’s pension increase barely kee…

The class struggle

Members the Educational Institute of Scotland (EIS), Scotland's largest teachers union, yesterday voted in favour of fighting austerity measures in a renewed campaign which could lead to industrial action in the autumn. The union backed motions calling for action to protect the profession from public sector cuts and oppose changes to their pensions being made by the UK government. While pension reform is reserved to Westminster, the Scottish Government has said it must implement the changes or face losing £100 million a year it receives from the UK government. Last November, Scots teachers took part in a UK-wide strike over pension changes – the first nationwide walkout by the profession in Scotland since 1986.

In a scathing attack the newly-elected EIS general secretary Larry Flanagansaid  “We understand that it is the UK government, the coalition, that has been the driving force behind the attempt to make teachers pay more, to work longer and to get less. We know who the guilty …

Old, Sick and Broke

A person born today will be forced to work until they are 77 years old before they become eligible for a state pension, according to a new report. The report, by the world’s largest accountancy firm PwC, also states that people in their late 30s today can expect to work until they are 70 before they can claim their state pension. The prospect of 70 and 80-year-olds in the workforce will soon become a reality, according to Professor Cary Cooper, professor of organisational psychology and health at Lancaster University Management School.

Alison Fleming, head of pensions at PwC in Scotland, said: “The era of retiring in your 60s is facing extinction with many people born today facing a future of work from 17 through to 77."

Age Scotland said that poorer people live shorter lives and so will have to sacrifice a larger portion of their retirement under the new plans.

Lindsay Scott, a spokesman for Age Scotland, said “Do not rely on the government to make provisions for your old age as …

Strike to defend pay and pensions

Tens of thousands of Scottish workers will be on strike today protesting at government pension reforms. Departments affected include Jobcentres, tax and benefit offices, courts, coastguards, Historic Scotland venues such as  Edinburgh Castle and Stirling Castle, and civilian workers at the Faslane nuclear base and the Scottish Parliament. Some health workers, mainly porters and technicians from the Unite union, are also expected to take action.

PCS Scottish Secretary, Lynn Henderson, said the changes, which appeared in April's pay packets for the first time, were costing some members up to £150 a month.

 STUC general secretary Graeme Smith said the action demonstrated the frustration people were feeling. "People feel aggrieved at being asked to pay more, having to work longer and get less at the end of the day," he said.

We are being told practically every day that we are living in hard times and that we must be prepared to tighten our belts. Longer working lives, lower p…

Docs Get Ready to Fight

The British Medical Association is poised to ballot its members on industrial action for the first time in 40 years. Under the Dept. of Health plans, doctors' pension contributions would increase immediately by up to 2.4%, with continued increases over the next two years. It also wants to raise the retirement age to 68 and end the final salary scheme for hospital doctors. Although the DoH proposals are intended to apply to NHS workers throughout the UK, Scotland has its own devolved NHS pension scheme which is overseen by the Scottish Public Pensions Authority. However, if the Scottish Government decided to break with the reforms it is likely Holyrood would have to pick up the tab for any shortfall.

Dr Dean Marshall, outgoing chairman of the BMA's Scottish General Practitioners Committee, said doctors north of the Border had been let down by Holyrood's inaction and the Scottish Government's "complicity" with Westminster on the issue.

Dr Marshall said: "Is …

Another union ready to fight

Doctors are threatening their first wave of industrial action in nearly 40 years, after they overwhelmingly rejected proposed changes to their pension plans. Under the final offer proposed by the UK government, some doctors will see their pension contributions rise from 8.5 per cent to 14.5 per cent of their salary. They will also have to work longer before they can retire. Existing methods of pension accrual will be replaced by a career average revalued earnings scheme for all doctors and there will be no automatic lump sum, currently enjoyed by some doctors upon retirement. According to the BMA, the proposed changes would see doctors working until 68, an age beyond which many feel “competent and safe”.

A UK-wide survey by the organisation of 130,000 doctors and medical students – including 6,638 in Scotland – found an overwhelming majority opposed to the pension reforms, with almost two-thirds prepared to take some form of industrial action. More than a third (36 per cen…

Fight back or revolution

Education, hospitals, transport and the like are primarily a service for the smooth running of capitalism and were brought in as such. It is the essential nature of the services in these industries which has led to their being associated with state control. In other words, they are useful to the capitalist class and so it is in their interest to maintain them at a reasonably efficient level. On the other hand, the public sector costs money to run and this can only come in the end out of taxes, which ultimately fall on the capitalist's profits.

Cameron and other apologists for the status quo claim that the whole population will have to make “sacrifices” to keep paying for those public services. What these defenders of capitalism utterly and deliberately fail to tell us is that the overwhelming burden of the sacrifice will have to be made by the working class. The rich will, for the most part, as usual keep their privileges and luxurious lifestyles. Capitalism always works in the int…

A full circle

Scotland's poorest people are facing food shortages akin to Second World War rationing, a charity has claimed. Pensioners and those on the lowest incomes are struggling to feed themselves in the face of rising food prices, Oxfam Scotland said.

Food prices have been rising at over twice the rate of the national minimum wage and at nearly twice the rate of jobseeker's allowance over the past five years.

Danny McCafferty, from Clydebank Independent Resource Centre, which helps unemployed people and those on low incomes, said "In some ways they've gone full circle. Those who are in their 70s and 80s experienced rationing and shortages after the Second World War and now they're going through it all again."

Judith Robertson, head of Oxfam Scotland, said: "It is a gross injustice that poor people in Scotland are finding it increasingly difficult to feed themselves and their families."

pay-cut for bank staff

Scottish employees of Clydesdale Bank face a large cut in take-home pay after the Glasgow-based institution said it will ask them to put 9% of their salary into its previously non-contributory pension scheme. Clydesdale will phase in contributions, starting at 3% of salary in 2012 and going up to 9% by 2014

“In common with many other organisations, it has been affected by reduced investment returns as a result of the downturn, the expectation of lower returns in future as well as improvements in life expectancy rates generally.” a spokesman for the bank said

Those who do not want to contribute will be offered a lower benefit based on 1/80 of salary rather than 1/60 for those who put in money. The bank has also cut the annual increases for benefits accrued after April 2012, switching to the lower Consumer Prices Index rather than the Retail Prices Index. This measure will be capped at 5%.
And for the bank executives? Unite union said the people being hit by the latest "…

feather-bedded and gold-plated

Ian Bell, the Herald's columnist has written a useful article about the attcks on state workers pensions. He points out that public sector pensions account for 1.5% of GDP. By 2027-28, the percentage is projected to rise all the way to an “unsustainable” 2%. It also takes no account of the effect of shedding half a million jobs thanks to George Osborne’s 2010 spending review.

"A reformer was invariably someone who wanted to make a bad situation better. Not any more. In the mouths of politicians these days, reform is a word meant to give credibility to changes that are liable to be unpleasant, unpopular, or both...When you are told you will have to work longer, pay more and receive less in old age for your pains, it’s little comfort to hear that your lot has been “reformed”..."

Negotiations are at an end even as the talking continues is the position, it seems, of Danny Alexander, chief secretary to the Treasury, who will defend his “fair and reasonable” proposals, of the p…

old age , same old story

The average Scottish male will be able to claim just five years of the state pension before he dies, under the new government plans to raise the retirement age.

ALMOST seven in ten British adults believe they will have to work beyond their pension age to give themselves a comfortable retirement, a new study has revealed.
In 2005 just 52 per cent of workers said they would have to work longer and 82 per cent planned to retire ahead of the state pension age. In 2005 the average male worker planned to retire at 60 years, with women targeting 59. But while a third of people would like to retire between the ages of 61 and 65, according to the latest report, 29 per cent now believe they will not be able to give up work until they are at least 66.

After a lifetime of toil many workers look forward to the comfort and leisure of old age. Alas, for many it is just another of capitalism’s illusions. Research published by Aviva yesterday showed that many people over 55 are likely to struggle to fu…

The reward for failure

We read Northern Rock's former boss Adam Applegarth received a £750,000 pay-off when he left last December. Applegarth, who is 46, is also entitled to draw on a pension pot of £2.5m at the age of 55 . Experts say that could bring him retirement benefits of up to £200,000 a year.

As we all have read Northern Rock collapsed and bad management was a factor in this bank's demise . So is this a capitalism's reward for failure ?

Many of us facing attacks on our final salary pension schemes will also be wondering why we have to work longer for less while the rich can dip into a retirement pot of gold .

Pensions - Inadequate Beyond Question

The UK's state pension system has been named as the worst in the European Union for the second year running in a survey .

British pensioners receive a pension equivalent to just 17% of average earnings, the lowest level in Europe, and well below the average of 57%.

The "inadequacy" of the UK's state system is "beyond question".

The lowest earners in the UK achieved an income in retirement which approached the level provided by other countries. This is because they qualify for extra means-tested help from the government. However, when all the criteria were taken into account, the UK was placed fifth in a list

Enterprising for some

Further to our earlier post on generous retirement pensions for those who hold directorships , we read that Iain Carmichael, the former finance director at Scottish Enterprise had an extra £380,600 pumped into his pension fund .

The annual accounts of the economic and business development quango, which were made public yesterday, reveal that Carmichael retired in March with a golden goodbye worth £539,105 - nearly three times the £200,000 that had been previously estimated.
He received £106,765 in pay in lieu of notice, £5544 for accrued holiday pay, £46,196 for loss of office and £380,600, which was transferred into the Scottish Enterprise pension fund to bump up his retirement pay. Carmichael's pension pot has now swelled to £777,600 - taking the current cash equivalent transfer value of his pension of £397,000 which, according to Scottish Enterprise, in "very basic terms", could be added to the £380,600 paid into his fund in March when Carmichael left the agency.
Scot…

Gold-Plated Pensions for the Few

We have been hearing a lot about the pensions "blackhole" and how we are all living too long to receive an adequate pension , and how we have to work until we are even older before we retire and even then pay more into the pension schemes .

Yet , the average company executive can now retire at 60 on a final salary pension worth more than £3 million , says the TUC's latest annual PensionsWatch survey. This works out at £193,000 a year, says the study, more than 25 times the average UK pension of £7,500 a year. The biggest executive pensions are now worth £320,000 a year, more than 42 times average staff pensions . One pension was found to be worth more than £1 million a year.

Directors of the UK's top companies have amassed pensions worth £891 million.

"Top executive pay has already created a new group of the super-rich who float free from the rest of society," said TUC general secretary Brendan Barber. "This report shows that this does not stop with the…