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Anti-ageism laws may force firms to raise pension contributions

Employers may have to boost pension contributions for employees of all ages to avoid breaking anti-age discrimination laws, says Scottish Life head of pensions strategy Steve Bee.

The Employment Equality (Age) Regulations 2006, which come into force in October, have raised concerns that employers will reduce pension benefits for older employees.
But Bee says it may be too late for employers to “level down” schemes as this may be deemed to be discriminatory against older employers from October 1. He says employers may instead be forced to raise their schemes, bringing younger workers in line with older workers.

Bee says: “There is a sound reason for acting ahead of time in such things as any judgements made in the future would almost certainly require schemes to offer parity to workers who lose out through discriminatory practices by putting them on the same terms as more disadvantaged employees.

“Levelling down the benefits of the advantaged employees probably would not be an option at that stage. My guess is that levelling up is going to be the next thing for trustees to worry about.”

HSBC head of pensions & retirement income Ian Martin says: “One would hope that employers would take a positive view towards levelling up.”

Standard Life revealed this week that it is scrapping the requirement for its 8,000 UK staff to retire at 65 to comply with the anti-ageism rules.


ABI hedges cap stance

The Association of British Insurers has sidestepped the Government’s challenge of setting a charge cap for the NPSS personal accounts scheme. In its response to the Pensions White Paper consultation, closing next week, the ABI has underlined its strong support for personal accounts but made it clear the scheme should not impinge on existing pension […]

Equity-release rates ‘less than mainstream SVRs’

Average equity-release rates are now lower than average standard variable rates for mainstream mortgages, says Safe Home Income Plans. Brokers have hailed the news as positive but stress it is vital that the industry gets the point across to consumers. Ship looked at annualised interest rates for the top 10 equity-release providers and found that […]

Ridicule is nothing to be scared of, Paul

News reaches the Diary that Financial Express’s Paul Wynne is masking a secret past as a 1980s New Romantic superstar DJ. While living in Australia, we hear that Wynne hosted his own radio show, blasting out the latest Adam and the Ants, Culture Club and plenty of obscure face-painted groups that the Diary has too […]

Axa close to sealing Thinc Destini deal

Axa is in acquisition talks with Thinc Destini and hopes to have the deal tied up soon. It says Thinc Destini would continue to be run as independent advisory firm and Axa would use the deal to expand UK distribution and offer greater consumer ins- ight and a closer relationship to customers. The move, exclusively […]

Lifetime ISAs – International Evidence

By Fiona Tait, Pensions Specialist Since the announcement in March, the Lifetime ISA (LISA) has attracted controversy. Heralded as a saviour for the self-employed and the young wanting to get on the housing ladder, the new LISA risks adding confusion for savers trying to fully understand the benefits of new workplace pension savings through auto-enrolment. To […]


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