Businesses spend record £41bn to shore up pensions
Saturday 23 March 2013
UK employers made record payments into staff final salary pension schemes in the past year, according to the Office for National Statistics.
Total employer contributions into staff pension funds rose to £45bn in 2012 from £39bn in 2011. The overwhelming majority of this cash, £41bn, went into propping up lucrative final salary pension schemes, most of which are closed to new joiners.
The amount of money that UK business is paying into its staff pensions has trebled in the past decade, trying to make up a shortfall resulting from record low rates of interest and increased longevity. Mark Duke, at the pension experts Towers Watson, said: "Employers are paying more and more money into their final salary pensions schemes even though the number of employees still in them is getting smaller and smaller."
In February, the ONS revealed the proportion of private sector employees still in a final salary pension schemes had fallen from 26 per cent in 2002 to 8 per cent in 2012.
Mr Duke added: "Despite these huge payments, many companies are still finding that their pension deficits are not getting any smaller, partly because of today's very low interest rates… Employers and pension scheme trustees face challenging negotiations over what to do about this. More money spent shoring up pension benefits promised in the past can mean less money available for wages, dividends and investment in the business."
- 1 Snoop Dogg and Jared Leto buy a stake in Reddit as A-list invests $50m
- 2 Prince held a Facebook Q&A and this is the only question he answered
- 3 Car tax disc changes: Two days to go - and they affect you much more than just not displaying a piece of paper
- 4 Now we know whose fault it is if you end up being murdered in Thailand
- 5 35,000 walrus gather ashore on north-west Alaska beach 'for a rest'
Exclusive: 'Putin's Russia has been my biggest regret,' says Nato's outgoing Secretary General
The Osborne Ultimatum: Chancellor’s benefits freeze bombshell will affect ten million households
There’s no excuse for Dave Lee Travis’s behaviour, but we need to keep a sense of proportion
Should gay sex be illegal? 16% of Britons think so
Mark Reckless becomes second Tory MP to defect to Ukip in a month
Benefits 'smart cards' plan revealed by Iain Duncan Smith to stop claimants spending welfare money on alcohol
- < Previous
- Next >
iJobs Money & Business
£18000 - £23000 per annum + Commission: SThree: Real Staffing are currently lo...
NEGOTIABLE: Austen Lloyd: TRUST ACCOUNTANT - KENTIf you are a Chartered Accou...
£18000 - £20000 per annum + OTE £30000: SThree: SThree are a global FTSE 250 b...
Highly Competitive Salary: Austen Lloyd: CITY - Law Costs Draftsperson - NICHE...