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Tuesday, 10 December, 2002, 12:46 GMT
Pensions in crisis: Your queries
Questions answered on pensions
Send in your questions and comments on pensions
It is now widely accepted that UK pensions are in crisis.

A recent poll indicated growing public anxiety about pensions.

Stock markets have plummeted, sharply reducing investment returns both for savers and pension funds over the past two years.

Have your say

More and more companies are closing down their final salary schemes, and a string of pension scandals are denting consumer confidence.

At the same time, there is an estimated £27bn ($43bn) savings gap - the difference between what people need to save for a comfortable retirement, and the amount they are actually saving.

On Tuesday 17 December the government presented its Green Paper outlining its plans for dealing with the crisis.

There was growing pressure on the government to act and find a long-term solution to the crisis.

What do you think of the government's proposals? Do you have confidence in the pensions system? What would you like to know about pensions? Do you have any questions?

Use the form at the bottom of the page to send your comments and queries.

Your comments:

Why would anyone invest their hard earned money in a scheme where the government can change the rules at any time, but you can't get your money out even if those changes are a complete rip off? Pensions schemes have been a sitting duck for government raids, and the same government refuse to take any responsibility for its own actions, even when those actions caused misery to thousands. Personally I'm never investing another penny in a UK pension ever again.
Martin, England, UK

The answer to all this is very straightforward. Value motherhood. If this was only seen as a valued occupation then we would not have this issue of who was going to fund our retirements as we would have enough people in the working population to look after us all. So who is to blame? Women's lib? Marketing executives? The media (more than likely).
Jeremy Hunt, UK

I have decided not to save for a pension at all. Why? Because when you get to retirement or end up in a care home, the government will take it off you in one way or another anyway, so why not spend it now?
John Suffield, UK

My generation has become used to living on the cheap - expensive housing, education and cost of living has seen to this. Continuing this on into retirement will offer no change - so I am not worrying at all.
c. Thompson, London

We are apparently under-providing for our pensions in the UK by £15-20 billion per annum. If we all started to save this amount of money per annum instead of spending it, what would be the effect on businesses of that amount of money being taken out of the economy?

One assumes that we would take less holidays, make the car last a year longer, put off the house move etc
Terry Barge, Somerset, England

After recent events such as the Equitable Life fiasco, how can we have confidence in such a vital long-term investment? We have discovered that 'guarantees' are anything but guaranteed, and 'with profits' can soon become 'with losses'. Yet under the current tax regime, what choice do we have? For each pound I put into my company pension, the company adds another pound. If I wanted to save the money some other way, such as an ISA, for every pound I wanted to invest the government would take 47p in income tax. [Using 2001-2 as an example: 40% income tax + 7% claw-back of Child Tax Credit.]
Trevor Barker, England

The problem is very simple, at present those who have retired have their pensions funded by those who are working now, as populations change this is always going to be potentially unstable. Imagine if pensioners today were receiving in their pension the actual national insurance they had paid over their working years. Currently NI is just part of the tax melting pot. When this government came in apparently with an agenda for change this is one area they could have forced through with such a large majority. Think the unthinkable was Frank Field's brief and he did, and where is he now? Five wasted years so far, with no radical action bar the foxhunting debacle. I am very cross.
Simon Boyd-Wallis, UK

No, I don't trust my money to schemes that the government can change the rules of under my feet.
Nigel Magnay, UK

I've saved into a company provided pension scheme since leaving school. People tell me that this is good because the companies match my own contributions, but apart from that, I don't know how it all works at all! I'm just content that I'm taking the steps offered to me, but I'm unsure of whether it's enough!
Nick, UK

The government should not be expected to bail us out for not preparing for the future, but there are obstacles preventing us from planning. As a 24 year old, how am I supposed to think about the future when I am struggling to pay off university debts and a 5x my salary mortgage for a tiny roof over my head? Let's get some legislation to limit property prices, speculators and second home owners from dominating the market. Maybe then us young people will have some money left at the end of the month that we can put towards a pension scheme.
Gavin, Sussex, UK

The pensions crisis is a great example of companies and the government abrogating responsibility for employees/taxpayers. At first, when the new accounting rules came in, companies said that pensions would be the government's responsibility. The government said it was companies' responsibility. Then both agreed on the idea that it is an individuals' responsibility. If you're a graduate earning less than 14K a year, how can you afford a comfy pension plan like the senior directors and politicians who perpetrated this? It's a scandal that would be called unlawful in most other countries. The government should force companies to take more social responsibility for their employees so that current generations of workers can enjoy the same benefits that older generations took for granted.
Paul, UK

What about the British Old Age Pensioners who have retired to Canada? I am 73 years old and paid all my National Insurance Contributions to ensure that I received a 100% pension when I retired in July 1994, yes I received the full pension then, but since then I have never received any of the pension increases that have followed, all because Canada does not have a reciprocal agreement with Britain, the British Government will not agree, yet if I was living in America and many other Countries who have this agreement I would receive all the increases as they come, I am having financial problems because I am falling behind with my pension because of that, so our problem in Canada for pensioners are getting serious, we have pensioners in their eighties and nineties who are only receiving 10pounds a week. We need help.
Harry Mills., CANADA.

I like millions of others employed in small private businesses enjoy no pension benefits other than those which I can provide for myself. After years of steadily increasing taxation and virtually no increase in salary I cannot afford to contribute to my own pension fund. However my council tax bill increases every year to ensure that the Public Sector continues to receive guaranteed pension benefits at my expense. The Public Sector urgently needs reform to bring it in line with the real world. Why should the rest of us pay for public employees to take early retirement and guaranteed pensions funded partly by public money. Rip-off Britain is alive and well in the form of Government and the public services. I'm beginning to think that the only answer is a revolution by those of us that create the wealth that the 'mollycoddled' public servants continue to fritter away in larger and larger sums year after year.
Derek, UK

I agree with Paul. This Government have made a nice provision for their own Final salary pension Scheme . They expect us tax payers to pay for this. They have however told the Unions that if they wish to offer similar inducements, they must get the money from investment and their members - one rule for them- another for those who eventually pay them.
Simon, UK

I am an independent financial adviser and I speak to people in their 20's and 30's every single day. The people I come across are utterly shocked when I show them just how much they need to save in order to provide for themselves in retirement. (Believe me, it is far in excess of the £50 - £100 per month suggested). However, all too often they tell me they can't afford to contribute anything at all, yet they think nothing of spending £200 - £300 plus per month on fags, booze, clothes clubbing etc. Of course, I'm not advocating a lifestyle to put a medieval monk to shame, but young people today need to realise that they have to take some responsibility for their futures, and the longer they leave this, the harder it will be.

Furthermore, anybody relying on property as their sole investment obviously does not remember the last property crash.
Anthony, London, UK

I believe that pension provision should be the responsibility of the individual. If a person starts drawing a pension at 65, that gives then about 45 years to provide for their own retirement. This approach would allow the government to cut taxes and red-tape. State pension will, and should, exist only at a very basic level.
Craig, 26, London, UK

I agree with Gavin. I'm 27, hefty student loans, graduate loans. Not a great salary, but I have a stakeholder pension scheme in place. How can I afford to buy a house as an investment for the future, knowing that my pension is likely to be worth a pittance in 35 years. Students now are even more worse off than me, as I was in the last year to get a university grant.
Robsta, Devon, UK

The only compulsion on annuities should be that people invest enough to guarantee a certain level of income (enough to ensure they are not a state burden). Beyond that, people should be able to spend their pension fund as they see fit. Why is the Government not listening to the concerns of people on this? I expect the government Paper will make some minor reforms, but persist with the current inflexible approach, which acts as a disincentive.
Martin, UK

It's an absolute disgrace. I would have made a better investment by placing my contributions into a bank account with zero interest! And that demonstrates my confidence in Pension companies to date and I still have another 30 years to go!
Dave Philips, England

Apparently if I'm dim enough to be ripped off at a car boot sale or with a used car from a back street dealer an army of highly paid trading standard officers are ready to push lots of paper about on my behalf. However, if I take expert advice & pay for a "professional" service run by a pension co like equitable & regulated by the treasury & FSA. I'm completely on my own & must watch my money evaporate just like my contributions to Serps. The only guarantee of a pension would seem to be joining the civil service.
Art Hannan, England

The future of pension planning is most certainly worthy of a Talking Point Special, as it will effect everyone significantly. The government should not balk at making the major changes necessary to remedy the crisis - and voters should not accept what appears to be the easy solutions as these would just land us and our children in more mess. My solution would be to make employee contributions compulsory unless covered by employer contributions, but allow withdrawals of a certain percent of fund value at marriage or child birth or severe illness. At retirement a minimum income would have to be purchased with the rest payable as a lump sum. Tax should be reclaimable on UK dividends too.
Richard N, UK

It's interesting to read the views of others here. Though I'm worried that at 28, my pension is (virtually) non-existent, I'm relieved to see that at least I'm not alone. Though I well understand the need to put aside for the future, how can I when almost all my income goes into feeding and housing my family? My wife doesn't work as it's actually more cost-effective for her to stay at home to look after our child than it would be for her to go back to work. It's time the Government took notice of the fact that the cost of living is increasingly putting younger people under pressure.
Ed Neale, UK

A large part of the problem is the high number of "older" people who have been made redundant by companies over recent years - people who have found it difficult if not impossible to find new employment and have sought financial support early from their pension funds. In this respect the larger companies only have themselves to blame. This and the fact that when money was available they took "holidays" from paying into their funds.
David, UK

I'm 37 and stopped contributing towards my pension a couple of years ago. Common sense told me that I would be better-off reducing my mortgage debt before starting to save. I transferred my mortgage to an "All In One" account and closed all my saving accounts. I have also released equity in my main home to buy rental property - this is a better long-term investment than a pension!
Karim, UK

Richard N has got it spot-on - a workable, pragmatic and incentivising solution. The Government should immediately appoint Richard N to its task force and get proper "customer" input into sorting out the mess and concern this is creating, rather than just talking with the financial services industry, who have a huge vested interest in preserving the current regime of annuities.
Martin, UK

The current state of pensions is a shambles - I am 45 and have changed jobs several times in my career to date. I have deferred entitlements in 2 company final salary schemes and a couple of personal pensions, plus an AVC scheme. Now I have been made redundant and don't have any income so can't save into the AVC, no employer is contributing to my pension, my AVC contributions are now only worth 75% of my contributions but I can't withdraw them. Annuity values are falling all the time and pension providers like Equitable Life have undermined confidence in the industry as a whole. Who do we trust, if anyone? I would have been better off putting all my savings over the past 25 years under the mattress! Companies are taking advantage of moving to "defined contribution" schemes to lower their contributions, in other words awarding a pay cut to their employees. I don't see any Government interest in the whole picture, they are only interested in superficial schemes that sound! g! old, whilst they continue to raid pension schemes behind our backs. We are being told that we are not saving enough, but why should we invest in schemes which simply lose money now and have uncertain futures? I'm sure I am not alone in this mess, but I really don't know which way to turn from here.
Jill McGavock, UK

Call me old fashioned, but:- 1. Why did pensions in the old days (at least quite a lot of them) manage to run at surplus? Could it be that the investments that they made were generating good dividends?? 2. Why? Maybe there was more optimism and growth in the economy. 3. Is it possible to have any level of growth without a "HEALTHY" level of inflation?? For those who may not have noticed these are actually rhetorical questions. Put in a nutshell I am really saying that maybe its time we looked at consecutive governments primary economic aims to maintain very low inflation and play the game of laissez faire with all other economic and legislative components. New Labour???? Bring back Keynes!!
Huw, Wales.

I think that the awareness levels of what happens to contributions/fund values in the event of death before and during retirement needs to be understood. We need to know clearly whether full pensions will be paid to surviving spouses and whether or not our estates will benefit in the event of a death prior to or during retirement. This knowledge will help us make in formed decisions about whether we should save for a pension or whether we should invest in capital which forms part of our estates on death.
Peter , UK

I venture to suggest that the following should give food for thought. "Given the statistic that 60% of the working population are in the Public Sector, then this pension should be extended to private industry and encompass everyone. In short, a national pension scheme for everybody - this should appeal to Mr Brown who can achieve his desire to make everyone equal!![including the future MPs]. To achieve this the Government should : 1. Scrap the £5 billion a year stealth tax; 2. discontinue all future 'index-linking' for all current (and future) pensioners, thereby 'capping' the outflow and put the onus on each person to deal with his/her own 'top-up¿ needs. 3. Other funding would be achieved through taxation and, in part, derived from non-repayment of taxation except at 'top-up' levels. Naturally, there would need to be some selected phasing, according to current ages, etc. What do you think?
Anonymous, UK

Why would anyone want to invest in a pension when the government plunder pension funds at every opportunity.
Nickie, uk

How are people supposed to save for a pension on £7.00 per hour, on that type of money you can only just survive in this country. I would need at least a 40% increase to be able to put any sort of amount away
Pete Hunter, UK

Having been the victim of an unscrupulous IFA's negligence in setting up a pension arrangement, I would be more than willing to work beyond the age of 65. Unfortunately, there is rampant ageism practised by too many employers. When will the Government get serious in introducing tough legislation to stamp out this form of discrimination? That would be a meaningful step towards defusing the demographic time bomb and easing the overall pension situation in the UK.
James MacPhail, Scotland

Having grown up in poverty I really appreciate the fact that I now have a disposable income. I'm not prepared to give my hard earned cash to anyone who can't or won't tell me what I'm going to get in return. I hope to be able to continue working till the day I die, but if not, at least I will have been able to enjoy life in the meantime. And because I actually know what poverty is like, I am not as afraid of it as the scaremongers would like me to be. Retirement will increasingly become something only rich people have, like big houses, yachts, swimming pools and high quality education and healthcare. For the rest of us, here's to a comfortable middle age, and a penniless old age!
Rupert, England

Every time Gordon Brown gets his sums wrong, he makes up for it by raiding the pension funds. The question is, what are we paying National Insurance for, when even the government now admit that we won't get anything in return for it?
Guy Hammond, England

I'm worried sick about my pension. I worked all my life (except one maternity leave) but had to give up my local authority job with a final salary scheme when widowed at age of 45. As a widowed mum, I get an allowance, effectively a pension, which prevents me going back to work because of the tax situation. However, I cannot save any money from that allowance, nor can I work and be better off to give me money to get an additional pension cover. I'm not regarded as unemployed because I have this allowance and no-one seems to be able to give me any advice as to what I can do. As a twice over graduate formerly holding a managerial position, it is very frustrating and I frankly fear for the future.
Jennifer, UK

t has for decades been the choice of many British based companies to reduce their staff using the company pension fund as an incentive. For example If you leave the company at 50 we will enhance your pension by 6 years and you can take you pension now 10 years in advance. This harms the pension fund in many ways. Not least for every person leaving the firm ten years of pension contributions will not be paid into the pension fund, not even the 6 years extra payment is accounted for. Also the people that leave under these schemes go and find another job or work cash in hand to make more money. This has all been done under both government and with the full support of the TUC. This leaves my own generation having to work longer for less of a pension. And what about the young who scrimp for work because there is no need to train them because we must keep the rich old pensioners of today the over fifties in work. It is time to reduce the pension age to 60 and if someone wants to leave! e ! a company pension scheme they leave and take their pension at 60 to save lost interest to the fund. The party is over no more covering up vast unemployment schemes using the pension funds. The unions cannot shout foul they came up with the idea of early voluntary retirement in the first place. The only people who will suffer for the greed of the people who started work in the 1960's are those who have remained loyal and stayed at work. EVR must be added to the pensions debate now so we can all know of its impact on pensions
John Butt, England

A pension is at the mercy of the stock market, your employer¿s solvency, your own personal contributions and, worst of all, 40 years of different Chancellors, approximately half of whom you will not have voted for, and don't have as good a return as private investing or property often does. Nobody would sensibly risk their nest-egg for such little return. Until a pension looks like a good investment, I and the rest of the 20something generation will continue to treat it as a bad one.
Iain Robinson, UK

There is a feeling of dis-trust in this country, people are suspicious of Govt. of Insurance Companies. People feel that they are being duped. What, they ask are the asylum seekers, the immigrants, the un-employed going to do. Are they going to be subsidised by the regular workers? When they retire they pay full price for prescriptions, council tax etc. The workingman feels as though he is being ripped off big time.
George Stokes, ENGLAND

The change took place in Australia in the late 70's. Companies began offering a Superannuation Savings Plan as part of a Salary Package. Later on employees were invited to increase their savings plan by way of a further Personal Contribution of up to 5%. This was changed by Government strategy that all employers will include Superannuation Savings Plan of 9% current rate for all Employees. Now as a Retiree I receive a Pension from my Super Fund Savings and a very small Government payment.
Ron, Australia

I have never contributed to a private pension. The reason? My contributions go into one big fund from which people who are currently retired are drawing at the same time as I contribute. These pensions are really big pyramid selling schemes in which the early investors get rich at the expense of people who join later.
Don, UK

here are many things wrong with the UK pension system today. In more ways than one, it is stacked against anyone whom saves for retirement. The first part of a possible solution must be to give all pensioners who have paid their National Insurance (including pensioners retiring anywhere abroad) a pension at a high enough level where there would be no means tested benefit entitlements. This would give all working people the incentive to save even modest amounts knowing that it will not play against them later at retirement and removes the pensioners from having to collect benefits (many feel it is charity and a stigma and hence rather do without). At the same time, people who wish not to work and rely on collecting benefits should receive far less than they would currently.
G.P.Russell, England

No-one seems to really appreciate just how scared people are about this crisis! I'm in my mid-forties and find it increasingly worrying as pension funds collapse and interest rates plummet. Just a few years ago, higher interest rates meant it would be a simple matter to pay off a mortgage on retirement. Regular contributions to a pension scheme were, we were told, a guarantee of a secure old age. No longer! My salary isn't keeping up with mortgage and household costs, savings aren't keeping up with inflation and pension companies seem to be able to just renege on their agreements without censure. Like an increasing number of people in an increasingly 'single' society, I don't have children to look after me in my old age. With retirement homes closing fast, I just have to pray my health holds out. I cannot believe that it is a Labour government presiding over this chaos - what next - a return to the workhouse?
Sam, UK

The point most people fail to grasp is that the majority of people paying in to personal pension schemes are unlikely to be any better off than people who made no provision and rely on state benefits, it makes more sense to spend it all now and rely on the state when the time comes. You don¿t hear any talk of those who have been on welfare all their days having to work till they drop.
Mac Roberts, Scotland

I worked for more than 40 years as a U.K. citizen. Have now been in Canada 22 years. My U.K. occupational and state pensions have been eroded by inflation, because of the U.K. governments (successive) refusal to index Canadian residents. My U.K. company pension has been targeted by the company to get hold of a 'surplus'.(No surplus now!!) They also took a 30 years contribution 'holiday' when there was a book "surplus". The last decade has seen governments, and companies manipulating constantly to the disadvantage of retired workers. Control over pension funds in the U.K. has for long been impossible for those who have contributed to them throughout working life.
Peter Duffey, Canada

Anyone over the age of fifty who's had to find another job will know how hard that is. Many opt for an involuntary early retirement because of such prejudice. One place where older workers appear to be unwelcome are Job Centres. Have you noticed how few of them are aged over fifty? It's probably less than one in ten compared with one in three in the UK workforce. That prejudice at the heart of the employment service is a major reason why pension costs are spiralling.
Andrew Dundas, United Kingdom

Once again the Government has not grasped the nettle. In my opinion what stops people investing in a pension is that once they reach retirement age they are forced to buy an annuity. Annuity rates are now very low because of the length of time people live. In addition, the big downside to annuities is if you die a week after taking out an annuity then your family have probably lost the whole proceeds of your retirement nest egg. People want more flexibility with their money than an annuity can offer.
Kerry Lee, UK

We already have compulsory contributions to our Pensions - it's called national insurance.

If the Government was so keen for us to save why does it tax savings?

Reasons not to get a pension: *Equitable Life *You can't get at it for years and there is no guarantee that you will get it at all if the company goes bust! *You have to buy an annuity which you cant pass on to relatives (even if you die the day after buying it) *You can get less than you put in *Pay fees to Insurance companies. *You get taxed on a pension when you draw it. *Changes each time you move company.
David, UK

I wonder if Andrew "There's no Crisis" Smith has read any of these comments. He hasn't acknowledged there is a crisis, so why worry about the little man on the street?
Tim, England

It's all very well the government expecting people to work passed 65. But who will employ people of that age. Many people are considered on the scrap heap at 40, with no prospect of obtaining new employment at that age.

I think a solution would be found if company management and government were subject to the same rules as the rest of us. Maybe Gordon Brown would be less keen to raid the pension funds if the value of his pension depended on them.
N.J., England

The pension deficit has been caused by the government milking the pension for £5 billion each year for the last five years. This has also lead to industry starved of billions normally invested in it.
John Russell, U.K.

Worried about pensions - No. Disgusted yes. The Government, with their 'I'm alright Jack' mentality are frittering away billions, which would rectify the low national pension, and provide everybody now and in the future with a reasonable pension at retirement. My private company pension scheme is linked to the stock market and has no guaranteed final payment, despite 25 years and £'000's contributions. This is scandalous behaviour of the pension company, who seem year on year to make millions of pounds profit for themselves, but are always reluctant to give any money out to its customers. I have to get a personal pension because the state pension is so miserly, otherwise why bother working, or frankly doing anything ? I'm not a gambling person but I'd be more likely to build my nest egg down the bookies or in a casino.
Stuart, UK

There are a number of very complex issues raised by the responses to the pensions crisis. I would like to highlight two from my own experience. Firstly confidence in the system. Like many others during the past twenty years we sacrificed holidays, new furniture etc to pay into an AVC scheme. I now watch this hard earned "pot of gold" slowly vanish like a rainbow, yes it is with Equitable Life. I can't therefore help but agree with the younger correspondents that saving for a pension is too risky! My second point is ageism. I worked for a Non Dept Public Body funded by a government department. In most respects this body was an excellent, if not model, employer but it insisted that employees retired at sixty unless there were very strong reasons for a short extension. I was healthy and consistently received positive appraisals but after a short extension had to leave despite being willing and able to carry on working. Surely Government Departments should be trailblazers if the Government is serious about a change of policy in this area. I must say it does make me rather cynical

Are the people telling us to save now for the future the same people who told us that endowment mortgages were completely safe? Not only two years into a 20 year endowment mortgage, I was told that I was probably going to be about £40,000 short at the end of the endowment term. I simply don't trust 'Financial' people trying to predict the future when they have got it so wrong in the past. Anyway, after making the monthly payment on my huge mortgage for my over priced house, paying for and running my car (as public transport in my area is so dire) and paying for food, heating, clothing etc, I have no money to put aside anyway.
Ian Cousins, uk

I am sure Andrew Smith will be protected from any 'radical shake-up'. Perhaps it really is time to emigrate.
Richard Boyd, England

Its all very well to raise the retirement age but there have to be employment opportunities for 'seniors'. I work in IT which is a sector rampant with ageist attitudes that are active against those of 40 let alone 65-70! How is the government going to promote the idea of working granddads!
Geoff Morris, UK

Reading the comments on this page, I would say the biggest problem with pension policies is that no one trusts the government or politicians and who can blame them for believing that, when they have feathered their own nest before telling us about the pension time bomb.
Kenneth smith, uk

There is no incentive for people to save for retirement, and people will not save, as long as means testing prevails. The only workable option is compulsory pension contributions through the present National Insurance system, in which there is already an element of 'means testing'. There should be one level of government pension for all individuals, set at the minimum subsistence level, with no means tested top-ups of any description. This would imply an increase in contributions by all working people. Those unemployed or disabled (including homemakers or carers) would be credited with contributions as now. Only then will there be an incentive for people to save for an enhanced pension on retirement.
d. lorriman, uk

In my opinion not enough emphasis has been placed on the damage Gordon Brown has done to pension schemes by effectively " taxing" them to the tune of £5.3 billion p.a. I think that because most people did not understand the implications or impact regarding advanced corporation tax, that he has tended to get away with it .....until now when the silent majority are just about coming to terms with what he has done.( The government then has the gall to ask us to save more !)
Syd Pochin, UK

If I had understood the risks involved I would never have subscribed to a company pension or made AVC contributions. I have been through all of the literature ever issued to me by my ex-employer and there is absolutely no mention of any risks never mind the huge 'insolvency' risk with company pension schemes that have only recently become apparent to the general public. What right minded person would invest all of their spare capital in such schemes if the potential risks were properly explained to them. On this basis, which is a similar one to the endowment mis-selling case, I believe that my company pension and AVC plan were mis-sold to me.
Mike McGill, UK

Labour didn't help by taking £5bn a year from pension funds.
Barry, UK

Why doesn't anyone ever ask the simple question. Where's the money/earning saved supposed to come from? In reality the schemes are flawed because people don't have this kind of spare money, therefore a cheap, farer scheme is required.

What defer your pension until you are 70? You must be joking. I know we are living longer and this is causing the Treasury some problems but the rest of the world seem to be retiring earlier not later.
David Watson, UK

I work full time and live alone, the government is currently saying I need to put £250 away a month for retirement. I struggle to pay bills and run my car. I won't even start to worry about the future until I can manage in the present. I earn above minimum wage, but it makes no difference the cost of living in this country is simply beyond my means. If the government is serious about addressing financial issues it should look to the 5% of the population with 90% of the money.
Dave, UK

I have been contributing into my pension all my working life so far, in one year I have lost over four thousand pounds from my pension due to the recession. Why should I bother throwing my money away anymore? The reason why we cant afford larger contributions is we are taxed too heavily to be able to afford to do so. Its all quite simple Tony we're all fed up with losing our money, don¿t you understand this?? We all cant afford to invest in large properties in Bristol!!
Paul Wilkins, UK

As an independent financial adviser based in Manchester I am often at the sharp end of the scenario. I agree with the other financial adviser in that it is becoming increasingly more difficult to encourage people in their 20's and 30's to save. Only today I had a client who would have received an employers contribution in addition to their own but they were not interested in a pension. Their attitude was live for today and not worry about the future.
harris frazer, u.k.

I work in the public sector. I have a final salary scheme which had (until today) allowed me to retire at 60. Now I hear that I will probably have to work on until I am 65 if I want a full pension. This is a measure of how serious things have got. I had long ago realised that no one is safe in the pensions game. The only one who is going to secure your retirement is you. I have increased my savings and tried to invest in a number of different ways. I am not relying on my pension as the only source of income in retirement.
Will, UK

While I was employed in the UK I did everything the government encouraged me to do: opted out of SERPS, put the maximum allowable into a Personal Pension scheme (which is NOT ENOUGH to save the kind of figures the government is now talking about), and put the max allowed into AVCs. Then Equitable Life problems hit so to minimise my losses I transferred out and took annuities elsewhere. This avoided the 10% exit penalty but I still suffered a 16% fund devaluation because Equitable took so long to process my paperwork. Now I am enjoying the most miserable annuity rates for the last 40 years. Therefore, I would say to anyone thinking of entering into a pension scheme - forget it. The rules will change so many times that you don't know what you are getting into. If the provider gets into trouble as Equitable Life did, the regulator and the government will stand by and do NOTHING. Consequently I have no choice but to continue working. I do agree however that people should save mo! re for their retirement.
Ian Black, UK

The current situation is convenient for politicians, because they are able to point the finger at people for not saving enough, while avoiding the need to make drastic changes to the taxation system which is actually the only way that today's (and tomorrow's) pensioners can expect a standard of living in line with that of the working population. Am I right or am I wrong? Perhaps a better qualified economist would put me straight.
Mr Chantrill, UK

I am in my 50s and redundant for the 2nd time. I have saved monthly into pension funds for over 35 years. One was DB, the others DC. The DB was frozen at my salary upon redundancy long ago and is of limited value and nil growth. My investment in the DC funds have already lost 20% of their value (I'm said to be doing well), and annuity rates are low. The government tells me I've got to save more (what with) and/or work longer (for whom). I'm lucky as I invested elsewhere (B&M) and have just enough to live on. Pensions are now a fiasco and whatever you invest in them just gets taken from you when you depart this world. A wonderful investment that you cannot pass on to your offspring! Oh what a good idea - NOT!
I, U.K.

Maybe Gordon Brown should review the billions of pounds he is taxing our pensions schemes every year. When the tax breaks on pensions funds were stopped in 1997 it was very quiet and nobody seemed to think it affected them. Now the stock markets are plunging those tax amounts paid would have bolstered the pension funds and maybe not so many company schemes would be closing. The government has to accept a lot of the blame for this problem, but it will be the public who suffer.
Natalie, UK

The Government does not need to "frighten" me about my pension. I have saved into a pension since I was 21 - with Equitable Life. I've saved the maximum I could, as the Govt says I should - and its worthless. Believe me, I am frightened enough already.
Jane, England

Pensions? Waste of time unless you are well off, and enjoy the tax breaks that you get as a higher rate taxpayer. Why should anyone who only pays tax at the basic rate bother to contribute, when the government will pay for your basic pension anyway? And National Insurance is a complete joke - this was supposed to be used to fund the state pension, but instead it has just become a tax on employers & employees.
Steve Darke, UK

My biggest problem is that with the defined contribution pension the cost charged by the fund provider for moving one fund to another is extortionate. Why can the government not provide the investment vehicle - which could then provide a pension fund that does not penalise you when you move jobs as is now common. For many of us the 2/3rds salary pension is unrealistic anyway with high levels of job mobility.
Tim, UK

I¿m in my early 50s and have suffered a double whammy of being made redundant and having an Equitable Life ¿with-loss¿ pension fund . From the so far contributions I am of the opinion that the inter-generational social contract between the young, paying for the old, as I did, is at breaking point. Also there is increasing disaffection of workers in the private sector subsiding pensions of those in the public sector. The young say they haven¿t got the money to invest, while people retiring now are seeing the money that they saved in pension funds disappearing together with 30% unemployment of the over 50s. Given these examples of the state we are in, you cannot blame young people from shying away from investing in pensions.
Ted, UK

Half the problem with people not saving for pensions is the fact that there is no guarantee that they will ever have access to those funds. Companies go broke, pension funds collapse - if the fund an individual pays in were ring fenced so at the very least you could always get you money back even if a company goes down then people would be more willing - but the bottom line is people have seen it happen so often they do not trust, funds and companies any more
Pat Gibbs, England

Mr Blair and his colleagues are living in another world, not ours

Jo, UK

Oh dear, the government has done it again with its green paper. Now they are saying that they will disallow people from drawing their pensions early! This clearly discriminates against people who have planned ahead and put enough away to allow themselves to retire early, providing yet more disincentive for people to save. I planned ahead and saved enough to ensure I could retire at 50 on a modest income and spend time with my family before they "fly the nest" and/or I "pop my clogs" - now the Government says that even if I have enough put away, I cannot access the fund! What is going on? Why shouldn't someone who has invested in a pension be able to get at it whenever they choose? Yet more inflexibility added to the already crazy annuity requirement - exactly what people these days DO NOT want. "Work till you drop" is now the principle - even if you have saved into your pension fund !
Martin, UK

Let me get this straight, you pay several hundred thousand pounds into a pension, you retire at 65, you draw it at the rate of about £10-£15k a year, you die at say 75 having spent about half of it, the rest goes back into the fund so that the Chancellor and a bunch of people you don't even know can get at it, Brilliant..............May I suggest leaving it on Deposit, you know how much you've got guaranteed, and you can spend it how you like and leave it to whom you want. You can "gift" it to relatives and keep Gordon Brown and his successors sticky fingers from touching your hard earned retirement money.
David London, England

I have contributed to a final salary scheme for 34years and was looking forward to a full 2/3rds of final salary pension. My employer has voluntary wound up the scheme and covered his Minimum Funding Requirement which means that he does not need to cover the accrued benefits. This means that I will receive a pension of 38% of what I am entitled to if I leave it to them to buy a deferred annuity on my behalf. The owner of the company had previously transferred his own pension out of the company scheme to his own SIPP. This apparently is all legal and above board under the current M.F.R.regulations. CAN NOTHING BE DONE TO END THIS INJUSTICE???
Bernard Coonan, u.k.

I agree change is necessary, but I object to changing the goalposts. I HAVE been making provision for retirement via company and other schemes and now it appears I will not be able to take the benefits when planned - I am in my 40's and decided to take voluntary redundancy and make other lifestyle/employment/investment changes, all on the basis that I could draw my company pension at 50 acknowledging it would be reduced for early payment. If the minimum age is to be 55 by 2010 then all my plans are shattered. How can the government do this to people like me who have made provision. Is there any chance the age will reduce from 55 and/or delay the implementation date?
Laurence, England

OK. Enough whingeing. Time for a practical suggestion:- Why not force a percentage of lottery money into a national pensions fund-provide a pension for all who have contributed (through work and NI contributions) proportionate to a combination of need and contribution. I know Government does not like admitting that they cant cope without this type of lottery contribution, but lets face it they cant. Also I harbour no grudges towards the arts, overseas development or sport, but this is far more important to the vast majority of people in this country.
Huw, Wales

I'm getting really frustrated with people railing against everything except their own unwillingness to save. People, you have two choices - fund for retirement yourself or let the state do it for you. If you choose the latter you pay a sight more tax than you do just now; if the former then it's hand in the pocket time. Are you going to vote for a party on a tax-raising ticket (by as much as 10p in the pound)? Everything else is just tinkering with detail - whether you put money in a pension, an ISA or under the bed is a matter for later on. Trust the government or your employer if you want - but don't be surprised if the rules change. Oh, and to the guy who's 28 and worried because his fund has fallen in value - chill out. You've got years to recover.
Mark, Edinburgh, UK

What a marvellous collection of wholly pertinent material. I wonder if any government pensions advisor will ever read any of it or take note. I doubt it! I have been lucky in working for an employer who has taken sponsoring my personal pension plan seriously. At one time, I got quite annoyed about scheme charges and thought that the stakeholder idea was a good one. I now realise that charges are but an insignificant issue compared to the ongoing uncertainty about what am I going to get when I reach retirement. The final salary schemes are now disappearing but it is time that legislation put an onus of guaranteed performance or final outcome upon pensions providers because that is the only way we will ever be able to plan for retirement.
Tony Couling, UK

We have a small flat that is owned outright. We are trying hard to save for our future. We pay money into pension funds with no guaranteed returns, our savings are earning very little interest because of how our economy is being managed and endowment policies we have to provide us with more savings are paying less because stock markets have crashed and insurance companies put shareholders before policyholders every time. The folk who are being sensible and who are trying to avoid excessive debt and provide for their future are the main losers in the current financial climate. It's time this government wakened up to the reality for those on average/below average earnings. Mr Blair and his colleagues are living in another world, not ours.
Jo, UK

Technically I have also paid into a pension fund over most of my working life, but I'm still left very scared and worried - I know my pensions provision is not enough but where do I get the extra money from? Also when I first started work retirement for women was 60, since I've been working its changed to 65, now 70 is being talked about - why should I work until I collapse paying in for a pension I stand little chance of receiving when refugees and the unemployed pay nothing and yet get more
Fiona Jarvis, UK

The thing that makes me angry is the government is complaining that everyone isn¿t saving enough. That¿s a truth, but are people also aware that this government also decided to tax pension funds and in effect is removing £5 Billion pounds a year from our funds. Its on to complain about a problem and also be a contributor to it.
Stan Wade, UK

I am disgusted to think I have been paying into a pension scheme for a considerably long time and am now being told that my pension will be minimal (if I'm lucky enough to receive one at all). I might just have well put money on the pavement outside my house and let the next passer by pick it up which is basically what the current situation amounts to!!!
Louise Mealing, UK

There's absolutely no point in saving for a pension on my current wages. I earn £5.40 ph and have never earned over £12K pa. This is what you get for having a law degree and a MBA from a top 20 UK university. I'm 30, nearly 31, and just cannot see when, if ever at this rate, I'll be able to put money aside to build a sizeable private pension for myself on my retirement. What am I, and no doubt thousands of others supposed to do? Rob a bank and conjure the money up that way? Answers on a very small postcard indeed please.
, UK

There should be collective responsibility for this mess across all parties for their implied and overt collusion with past, present and future governments who clearly owe a duty of care to this mugged generation; which cannot possibly generate the necessary funding for an acceptable pension! Shame on you Tony Baloney
Peter Lawton, England

Crazy stupid system. Why save money that you can't get at in times of personal financial crisis? Lose your job, lose your home, live in squalor, but you might have a nice little pension waiting for you when you retire from poverty. Hey, you could move to a better cardboard box!! What¿s the bloody point of that? Personal Circumstances can change but Pensions can't accommodate this. Waste of Money.
John, England

I've put thousands into a pension scheme over the last 12 years. I'm putting nothing else into it now. Why should I when people that have contributed nothing will end up with the same level of income as me on retirement? Under the current means-testing obsessed system private pensions are waste of time and money.
Russ, Sheffield, England

It would be helpful if someone, the government or whoever, were to cost a viable pension in terms of Government expenditure and tax, put it to the electorate and see what the people say.
Michael Biggs, uk

I'm one of the middle aged, middle England people who has believed for most of my working life that if I saved and paid my taxes I could look forward to a reasonably secure old age. How wrong could I have been? While the country is run by a Government that is prepared to spend millions fighting a war that the majority do not want and ignore the well being of it's electorate what hope is there? Roll on the next General Election.
Peter, UK

I paid into a Police Pension for 30yrs and was retired prematurely with Arthritis. I now pay the taxman £200 + per month. What an encouragement to pay a good pension when you still get taxed on it.
Graham, England

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04 Dec 02 | pensions crisis
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