Only one third of people in the private sector now saving for retirement

The latest ‘Pension Trends’ report from the Office for National Statistics (ONS) shows that the number of people in the private sector making provision for their retirement has fallen dramatically in recent years. In 2002, 52% of men and 41% of women were paying into a pension scheme in the private sector, these figures have now dropped significantly with only 39% of men and 28% of women making contributions. Membership of pensions amongst self employed men has also fallen dramatically, from 64% in 1998/99 to just 38% in 2010. Conversely, the report found that the situation in the public sector was very different, ...

Public sector retirement age to be linked to state pension age

In a speech made yesterday Danny Alexander, Chief Secretary to the Treasury, (left) has confirmed  that the retirement age for public sector pensions will in future be linked to the state retirement age. In addition Mr Alexander also confirmed that member contributions will have to rise, although he went on to say that these rises would be capped for the low paid. He also confirmed that existing benefits, already accrued by members, will be protected. Mr Alexander said that public sector pensions should be "affordable and sustainable but still amongst the very best available". He went on to say that "It is ...

CPI may be extended to private pension schemes under government plans

CPI could be made easier for private pensions to adopt. Statutory power changes are planned for private sector pensions to allow for the CPI to be introduced. Private sector pensions may be able to use the Consumer Prices Index (CPI) to calculate pension funds instead of the Retail Prices Index (RPI) under new government legislation. This summer it was announced that public sector pension schemes would use the CPI measure instead of the RPI to save billions of pounds each year - the CPI rises at a slower rate than the RPI meaning that the government would have to pay out less cash to pensioners each month.