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Attention: newsdesks; personal finance; industrial

Biggest pensions losers revealed on day of pensions demonstration

As trade unionists, pensioners and their supporters gather in London for the TUC’s Pay up for Pensions demonstration today (Saturday), the TUC has published new research showing which groups of employees have been the most likely to lose out on pensions coverage.

The figures (drawn from the latest official New Earnings Survey) show that over the last six years:

• employees in the hospitality, community care and construction sectors are the most likely to have lost all pensions coverage, with only one in five workers in restaurants and hotels now having any pension.

• employees in financial services and retail are the most likely to have had pensions based on their salary replaced by pensions dependent on investment risks.

• the lower paid people are the more likely they are to have lost pension rights in recent years. A third fewer of those earning under £200 a week now have any pension compared to six years ago, while men earning more than £600 a week have seen only a four per cent fall, and women earning over £600 a week are the only group to have increased pensions coverage.

• TUC General Secretary, Brendan Barber, will tell the Pay up for Pensions rally in Trafalgar Square:

• 'Today’s demonstration is the TUC’s pensions wake-up call for the Government and politicians of all parties. It’s time to face up to the ticking pensions time-bomb that threatens more and more people with poverty in retirement. Those who used to have good pensions now have poor pensions. Those who used to have poor pensions, now have no pension. Government and employers say it is up to individuals to make their own arrangements, but few can afford to save enough and many are simply not saving anything.

• 'We are calling for a long-term guarantee from all the parties that the state pension will keep up with earnings and not wither away. It should give everyone a sure foundation in retirement.

• 'Too many employers have run away from their responsibilities. Unions stand ready to resist such cuts, but it’s time to make every employer pay up for pensions, with compulsory contributions.

• 'Britain needs a new pensions partnership with state, employers and employees all playing their part. It’s time to pay up for pensions.'

Rodney Bickerstaffe, President of the National Pensioners Convention, which is also backing today’s demonstration will tell the rally: 'The crisis in the private and occupational pensions industry now offers the clearest evidence that there has to be a decent basic state pension that is available to all. Millions of workers are currently without any pension provision except that which will be provided by the state - but the state pension is so low that many of them will face years of hardship in retirement unless we act now.

'One in five pensioners live below the official poverty line and millions are forced to go through the indignity of seeking means-tested support at a time when Britain has the fourth strongest economy in the world. We have to wake up to the fact that pensions affect everyone - young and old - and a decent state pension that is free from means-testing and linked to earnings is the most effective way of providing dignity and security in retirement for the pensioners of today and tomorrow.'

Biggest sectoral drop in any pensions coverage

New Earnings Survey figures show that:

• In the hotel and restaurant sector fewer than one in five full-time employees now has any type of pension scheme compared around to one in three six years ago. The sector has seen the biggest drop in pensions coverage. Over six years there has been a 43 per cent drop in pensions coverage for men and a 40 per cent drop for women. Only one in ten employees in the sector are in a salary related scheme.

• In the community, social and personal service sector there has been a 24 per cent drop in pensions coverage for men and 20 per cent for women over the last six years. Less than half of full-time men are now in any type of pension scheme compared to almost 65 per cent in 1997. Coverage for full-time women has also fallen below half, slumping from 59 per cent to 47 per cent. Only one in three workers in this sector are in a salary related scheme - 34.7 per cent for men, 33.4 per cent for women.

• In the construction sector there has been a 25 per cent drop in pensions coverage among men. A little over one in three male employees are now in a pension scheme compared to almost half six years ago. Only one in five male workers are in a salary related scheme.

Biggest switch from salary related pension (linked to pay) to money purchase (dependent on the ups and downs of investments)

• In banks and insurance companies (Financial Intermediation) between 2001 and 2003 there was a 21 per cent drop in coverage for women and an 18 per cent drop for men. In 2001 70 per cent of full time women workers in this sector enjoyed a salary related pension. That has now fallen to 55%. The figures for full-time male employees are 52 per cent now compared to 63 per cent in 2001.

• In the retail sector since 2001 there has been 28 per cent drop in salary related coverage among full-time women workers, and a 12 per cent drop in coverage for men. Around one in five workers in this sector is now in a salary related scheme.

Notes to Editors:

The TUC Pay up for Pensions demonstration assembles on the Embankment (near Temple tube station) at noon today (Saturday). Led by union general secretaries, pensioner leaders and Prudence the giant inflatable pensions piggy bank, the demonstration will move off at 1pm to Trafalgar Square for the rally. Further details can be found at http://www.tuc.org.uk/pensionsrally

Contacts:

Media enquiries: Liz Chinchen 020 7467 1248 or 07699 744115 (pager) or email media@tuc.org.uk

Press release (1,100 words) issued 18 Jun 2004