The Great Debate UK
-Damian Stancombe is head of corporate defined contribution at Punter Southall. The opinions expressed are his own.-
Pensions were a prominent feature of the chancellors’ debate recently, and are becoming a key battleground in the run-up to the election. Perhaps more interesting for us, however, has been the reaction of UK plc to the pensions issue and any government-led ‘solution’.
Punter Southall recently undertook its annual Corporate Defined Contribution Survey 2010, one of the largest and most wide-ranging undertaken in its field. Responses were received from representatives of a diverse spread of over 330 companies, and considered all aspects of pensions, but focused on defined contribution in the UK and influencing issues: from the current and future impact of economic conditions to the far-reaching effects of planned pension reforms.
The respondents included some of the UK’s largest employers, including 24 FTSE 100 companies and the survey conveys an authoritative range of opinions reflecting the views of UK plc. It revealed a strong sense of dissatisfaction with politicians for their seeming inability to bring about positive changes with regard to pensions. The feeling was that any future political change would have little or no impact on pension legislation, for better or worse. This is borne out by the fact that 86 percent of respondents believe there will be a change of government at the next election, while 57 percent believe this will have little impact.
-Simon Banks is a principal at Punter Southall. The opinions expressed are his own.-
This summer we have seen the closure of many “defined benefit” pension schemes, which provide benefits based on a formula linked to salary. They are closing because they are reliant on employer support and have either become too expensive, or have grown too large relative to the employer.
On healthcare, the White House is struggling with a political riptide that threatens to drag it into deep water.
Americans, as they contemplate change, have suffered a weakness of nerve. The main reason is that nearly two thirds of Americans are apparently happy with their healthcare coverage, for all its deficiencies. Repeated reassurances from President Obama that those who like the existing set-up will not be forced to change, have had little effect.