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May pledges to safeguard pensions from greedy bosses

Prime Minister Theresa May has promised to crack down on highly paid executives who do not support workers’ pensions enough.

In an article for Sunday’s Observer May argues markets need to be rebalanced in favour of ordinary people.

She makes the case on the back of outsourcer Carillion going into liquidation last week forcing the government to guarantee a variety of public services.

The company had a £587m pensions deficit at the end of 2016 and 13 pension schemes with 27,500 members who are being put into the Pension Protection Fund.

In her article May says: “In the spring, we will set out new rules for executives who try to line their own pockets by putting their workers’ pensions at risk – an unacceptable abuse that we will end.

“By this time next year, all listed companies will have to reveal the pay ratio between bosses and workers. Companies will also have to explain how they take into account their employees’ interests at board level, giving unscrupulous employers nowhere to hide.”

Reacting to May’s article, Royal London director of policy Steve Webb says: “The Government is right to criticise firms which pay excessive bonuses or put large dividends ahead of plugging the hole in the company pension fund.  But they will find it difficult to convert this concern into workable policies, and there is no ‘silver bullet’ solution.

“Every company is different, and a dividend payout which looks excessive at one firm may be quite sustainable at another.  Despite all the concern about the BHS case, nothing has so far changed, and we are probably years away from new legislation coming into force.”



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There are 7 comments at the moment, we would love to hear your opinion too.

  1. Labour’s 1997 pension raid now costs taxpayers some £10bn a year – double the amount Gordon Brown had initially outlined.

    HM Treasury was able to collect this money because Mr Brown abolished the tax relief pension funds earned on dividends from stock market investment.

    The policy, one of Mr Brown’s first as Chancellor, played a starring role in the collapse of final salary pensions in Britain.

    For this useless PM to say “markets need to be rebalanced in favour of ordinary people” should reflect on Brown’s move, one that has not been reversed, before making stupid comments like this.

  2. We all know the examples given, whether it be BHS or Carillion, the bosses knew what they were doing, they knew that their large bonuses would reduce the amount available to cover the companies liabilities.

    Surely it would be relatively easy to have a caveat around directors responsibilities, to say that if they accepted excessive packages, or paid excessive dividends, then the company failed, they would be guilty of mismanagement.

    The penalty for which would be being barred for life from being a director of any company?

    I suspect that would put paid to this type of actions.

  3. Andy Robertson-Fox 22nd January 2018 at 11:31 am

    But will she abolish Section 20 of the 2014 Pension Act and its forerunner and thereby protect the index linking entitlement of the State Pension for all pensioners? Currently some 4% of all UK pensioners world wide are not protected in this respect from that greedy boss called “The Government”.

  4. Oh how I laugh at the injustice of it all ……

    How big is the FCA pension scheme deficit ……. and who is levied to plug this hole…..

    I fear Mrs May maybe playing a game of “where **** is Waldo”

  5. The irony and hypocrisy of the current PM and all of those who went before her. Pretending to care about seniors rights, if she really cared she would end the frozen state pensions of the 4% who have NO….yes that’s ZERO….. increases EVER just because of where they live. These vulnerable seniors have also paid their NI contributions all their lives, just the same as everyone else but this deliberate policy by the British government means they struggle to live with dignity. May needs to put her own house in order.

  6. Safeguard us from pension abuse? I would suggest she looks a bit closer to home… (MPAA)

  7. The Frozen pension policy has already been mentioned and no surprise there because this is everything that government should not be !
    Discriminative – definitely
    Unjustified- certainly
    Unfair – decidedly
    Immoral – do they even know the meaning of it ?
    All descriptions show a lack of
    probity by the politicians who have failed to address this punitive policy for so many years that it is hard to understand their reasons why ?
    Certainly not the financial excuse that is pushed out when Overseas Aid can be found which is 20 x the amount needed to pay all of these pensioners their correct pension indexation.

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