date: 22 October 2007

embargo: immediate

Deregulation review "goes a step too far", says TUC

Commenting on the Government's response to the Lewin/Sweeney regulatory review of occupation pensions, TUC General Secretary Brendan Barber said:

'The TUC has always accepted the case for a thorough review of the regulatory environment for occupational pensions, but there has always been a danger that deregulation strays into attacks on pension scheme members' rights and benefits.

'While we welcome that ministers have stood up to the very strong employer
lobby to end Limited Price Indexation (LPI) for pensions in payment, we are very disappointed at the proposal that the cap on the revaluation of deferred pensions should be cut from 5 per cent to 2.5 per cent, against the recommendation of the review. This is particularly important for those with broken careers, typically women and carers.

'If we were to return to higher rates of inflation in the future this could quickly eat away at benefits built up early in a working life - something that seems to go against the Government's message that we should all start saving as early as possible.

'Someone somewhere has made a pretty cynical calculation that widespread ignorance of how pensions work will protect the government against what should be an angry backlash.

'The TUC will resist this proposal during the consultation, as we will any proposal to make it easier for employers to claim scheme surpluses.'

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Contacts:

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Press release (400 words) issued 22 Oct 2007