As revealed in this week’s Money Marketing, the firm says it suspended contributions from July 1 to maintain profitability in the economic environment and will lift the suspension no later than January 1, 2011. Amex says it will keep staff informed about its readiness to lift the suspension before 2011 if economic and business circumstances change. A spokeswoman says contributions are unlikely to be backdated when they are resumed.
Before the suspension, Amex made a core contribution of 3 per cent to employee stakeholder pensions and would match contributions to a maximum of 6 per cent. The firm has around 6,000 employees in the UK but would not disclose the number of staff in its pension programme.
Hargreaves Lansdown head of pensions research Tom McPhail says: “Cutting the pension contributions can buy you a bit of breathing space but the price paid is that your employees are going to have to work later into retirement or they are going to have to retire on less income.”
Richard Jacobs Pension & Trustee Services managing director Richard Jacobs says: “It is very worrying that Amex is doing this on a stakeholder pension. It would not surprise me if when it comes to reintroducing contributions they decide to stop the stakeholder plan and run with personal accounts at a lower rate.”