Great Britain: employers demand a revision of the law on occupational pensions

Employers’ plan. The CBI proposes a series of measures to relieve pressure over businesses with pension funds. First, the Pensions Regulator should give businesses fifteen years (instead of ten) to fill in their pension fund. This would allow them not only to establish a longer recovery plan, but also to have more flexibility and less pressure as to the way the fund is used. Then, they could focus, for instance, on maintaining employment and investments during difficult times. Secondly, the CBI thinks that it is necessary to change the way pension funds are evaluated – currently based on the “market-to-market” approach, which distorts reality because of the market’s volatility. Therefore, the long-term should be given priority to analyze funds’ position on the market. The employers’ organization attacks the government on several points: reform the law on businesses’ contributions to the pension fund; allow businesses to let employees work after 65; revise the project to remove pension funds’ tax advantages. Finally, the Pension Protection Fund (PPF), created five years ago to guarantee pensions when businesses go bankrupt, shouldn’t require larger financial contribution from the companies. In addition, to reassure the members of the pension funds and businesses worried about the PPF going bankrupt, the government will vouch for it, as a last resort.