Money News: Two million-strong Saga joins company pensions campaign

Click to follow
The Independent Online

The campaign to compensate up to 125,000 workers who lost final salary pensions when their employers went bust has been bolstered with political support from Saga, the over-50s financial services provider.

Saga has launched an online petition demanding that the Government accept responsibility for restoring the workers' pension rights. It also plans intensive lobbying of ministers and MPs at the Labour Party conference next month.

The pensions guru Ros Altmann speaks for the Pensions Action Group (PAG), which is fighting for compensation. She said: "The potential for Saga's two million customers to wreak political damage on the Government is enormous. This group is far more likely to vote than the rest of the population."

Tens of thousands of workers whose company schemes were wound up when their employers went into administration do not qualify for compensation from the recently set-up Pension Protection Fund (PPF). This provides recompense only for people who have lost final-salary pension rights since 6 April 2005.

Instead, they rely on limited funds from a separate £400m pot, the Financial Assistance Scheme. Critics argue its reserves are insufficient.

The Government has repeatedly maintained the workers' loss is not its fault, despite a report from the Parliamentary Ombudsman, Ann Abraham, that found evidence of "maladministration". She claimed official literature had misled workers by encouraging them to invest in company pension schemes that were not adequately funded.

The Ombudsman's calls for compensation were rejected, as were those made by the Public Administration Select Committee in a separate inquiry that ended last month.

The PAG has lodged a request in the High Court for a judicial review of the Government's refusal to award compensation.

Energy prices: Powergen gas bills rise by 18%

Millions of Powergen customers will pay more for their gas and electricity from tomorrow after the energy supplier announced its second price hike this year.

Gas prices will rise by a whopping 18.4 per cent and electricity by 9.7 per cent. Powergen blamed the rises on a near-doubling of the cost of wholesale gas since January last year, principally because of supply problems.

The announcement brought the company into line with its major rivals, all of which have put up prices at least twice this year.

British Gas hit customers in July with increases of 12.4 per cent (gas) and 9.4 per cent (electricity), its third price hike within 12 months.

Tomorrow's price rises will leave Powergen customers facing average bills of £644 a year for gas and £393 for electricity. Since 2003, they will have seen their average annual bill rise by 107 per cent (from £311) for gas and 62.9 per cent (from £241) for electricity.

Concern is growing among MPs and consumer groups that so-called fuel poverty - defined as occurring when 10 per cent of household income has to be spent on heating - will become a serious problem this winter, particularly for the elderly.

"Millions of households already struggling to pay their bills will soon face the terrible dilemma of having to choose between heating their homes or putting food on the table," said Ann Robinson, director of consumer policy at the utility suppliers price-comparison website uswitch.com.

Even in the present climate, those consumers who have never switched supplier- or haven't switched in recent years - will make considerable savings by doing so.

Student finance: Average graduate debt is now £13,250

Graduates now leave university saddled with an average £13,252 of debt. This figure is 5 per cent higher than last year, according to the annual Student Money Matters survey from NatWest bank. And with the introduction of student fees in September, student debt is expected to rise even more steeply next year.

The proportion of graduates entering the world of work owing more than £10,000 remained the same as last year, at 62 per cent, the report said.

Despite concerns about debt levels - 57 per cent of students questioned admitted to anxieties about owing so much - fewer students than in 2005 (one in five compared with one in three) had considered dropping out of university to take on a full-time job.

Students increasingly rely on part-time work to fund their undergraduate life. Nearly nine in 10 interviewed for the survey said a part-time job was necessary to make ends meet.

In term-time, 46 per cent of students work an average of 14 hours a week.

"Despite the cost [of undergraduate life] rising, students are taking it in their stride and cutting back on their spending," said Mark Worthington, head of student banking at NatWest. "New students are much more clued up about the financial realities of university than in previous years."

Looking for credit card or current account deals? Search here

Comments