Letter: Pensions are not company business

Sir: Perhaps because I am a Maxwell pensioner, I shall not spend pounds 50 on the Goode report. Like most pensioners, I do not have wide-ranging actuarial know-how, so cannot join discussion on most of the technicalities mentioned in your report. I therefore welcomed Hamish McRae's practical approach (1 October), not least since, having changed jobs at least half a dozen times in my working life, I match his career-fit picture.

My pension progress over 40 years in journalism and publishing was rocky, to say the least. From 1979 until 1990, I was in charge of publishing at Aberdeen University Press, which Maxwell purchased in 1978. I was urged to consider the job by Sir Monty Finniston, then a friend of Maxwell's. To my nervous reaction, Sir Monty offered reassurance: 'Bob Maxwell may be a fool: he's not a rogue.' Yes, that way round. In recent years I have been involved in oversight of pay and pension conditions in three other contexts, two of them charities. Thinking on pensions should include the small operation as well as the large, and should allow for movement both ways.

Mr McRae says that companies should not be running pensions at all. I know what he means, but I would argue that employers should provide simple means whereby part of salary is set aside for pension, and they should, where possible, match the employee's contribution. There it should end: thenceforward companies should not be running pensions, their involvement being suspect - for several reasons:

1. The concept of company loyalty related to pension is pernicious. There should never be pension disadvantage to the employee in changing employment.

2. Employer responsibility for pensions involves diversion from the employer's main business. Even senior staff rarely understand or can explain a firm's pension scheme. This can lead to manipulation or abuse by those who can.

3. How is employee representation to be determined and how competence ensured? Brilliant bullies like Maxwell know how to con their staff, some of whom may be relatives.

4. Senior staff often enjoy, or hope to enjoy, generous pension perks. They may therefore be indifferent to the workings and supervision of the basic schemes.

5. Why should employers ever enjoy contribution holidays? Surpluses should be seen in the same category as insurance policy bonuses. A pension scheme, administered from outside the firm, should from the start envisage the possibility of surplus and cater for it, only to the advantage of the employee.

Yours etc,

COLIN MACLEAN

Blair Atholl, Tayside

2 October