Talks promised on pension changes

Firms will have to consult before cutting back on benefits

Employees are to get more say over how their workplace pension scheme is run.

From April, regulations will require employers to consult all pension scheme members before making major changes to terms and conditions.

Firms must consult if they want to close the scheme to new members or move from a final salary to money purchase pension arrangement.

The move follows a recent spate of firms cutting pension benefits in order to save money.

These regulations will mean that employees will now have a voice about any major changes to their pension scheme Stephen Timms, Pensions Minister

In recent weeks, firms, including the Co-op, Arcadia, Provident Financial and Rentokil have either cut back on their pension provision or asked their workers to contribute far more cash.

Consultation period

In future, employers will have to consult workers or their representatives for at least 60 days before introducing changes.

"These regulations will mean that employees will now have a voice about any major changes to their pension scheme," Stephen Timms, Pensions Minister, said.

"Members need to fully understand their pension scheme and the effect that changes will have on it and their future pensions," he added.

The regulations will be phased in over the next two years.

From 6 April only firms with 150 or more employees will have to consult, followed by companies with more than 100 workers in 2007 and those with more than 50 staff from April 2008.