pensions: tuc challenge over figures
WORKERS, MAY 2003 ISSUE
The CBI and the TUC have clashed over the cost to employers of providing compulsory contributions to staff pension schemes. The TUC responded to the government Green Paper on pensions by suggesting that one element in producing long-term pension security for all should be through a compulsion on employers to contribute 10% of salaries to employee pensions.
The CBI claimed this would add £29 billion a year to company costs but the TUC has challenged the figures, pointing out that the CBI had used average earnings for their calculations, but most workers not currently in schemes are on lower wages, cutting the total to £11 billion. If the scheme were phased in the initial costs would be closer to £3 billion. The TUC is also pressing for protection when schemes are wound up, with more consultation, solvency insurance and a new Pension Protection Fund. It will oppose any attempt to increase from 50 to 55 the age at which an individual can draw a pension.