|
I received the following today from an irate pensioner: Dear Fred, A friend of mine works for a well-known carmaker in the Midlands. It is at the moment undergoing all sorts of traumas but they don’t appear to be affecting their Pensions Fund. During a ten year period, late 70s to late 80s, the Company had a contribution holiday, not so the employees. In the early nineties surplus’s were used to enhance pensions and also used by the Company for research and development and design. 95/96 more surpluses were used to enhance pensions further introduced early retirement and give 10 year bridging monies payable to those retiring at 55 onwards. This was an extra £1500 per year per pensioner until the pensioner attained 65 years. The Company was again on a contribution holiday and have been for about 3 years. In the pension fund there are 93000 pensioners and deferred members. There are currently 27000 in service members. The fund, on top of enhancements, has never failed to give a cost of living increase, not bad for a Fund where the employer has not only taken out the surplus itself but in the last thirty years has only paid in for seventeen of them. At the actuarial valuation 5th April 1999 the fund, even after tax, had a surplus again of some £41,000,000. As a safeguard the Pensions Act 1995 requires that all schemes meet a minimum level of funding. The Fund has equal to 134% of the statutory minimum. This convinces me that all is not well with our Fund, who now appear to have £55,000,000 minus not only that, no increases for pensioners for the last two years, accrual rates from 1/40 to 1/60 now to 1/80. It’s as much a joke as the 1% increase proposed for the old section pensioners which our esteemed employers have even had the temerity to veto, not only that but are refusing to make up the shortfall in the fund which they are legally obliged to do. My question is who is wagging whom? Chas |