Workers should forgo pay rises for pensions – CBI
UK – Employers group the Confederation of British Industry says employees should be prepared to forgo annual pay rises to boost pensions.
“Employees should be prepared to save more for retirement from their own pay or forgo an annual pay rise to start and build their pensions,” the CBI said. “Trade unions should accept this in pay bargaining.” The recommendation is one of 22 recommendations the CBI has put forward to help solve the pensions crisis in the UK.
The CBI also said that the state pension age should be gradually raised to 70 between 2020 and 2030.
Brendan Barber, general secretary of the Trades Union Congress, said: “Employees in particular will be angry that their employers are suggesting they should work until they are 70 before they get a state pension, especially as the CBI are lobbying hard for 65 as the age at which employers can force people to retire.”
Barber added: 'While we welcome the CBI's call for employers to act responsibly and to be generous, this call has come too late for the millions who have lost out as companies have cut pensions for their staff, while keeping bumper boardroom packages.”
The 40-page CBI report – “Securing our future - developing sustainable pension provision in the UK” – also calls on the government to provide “seed-corn funding” for sector specific schemes.
The Chartered Institute of Personnel and Development said the CBI pensions paper contributes to debate, but does not provide all the answers.
Charles Cotton, CIPD pensions adviser, said there are “no quick fixes to the pensions conundrum”.
“The CBI's own response appears to offer little to counter inevitable criticisms that their solution will lead to backwards steps in efforts to tackle pensioner poverty.
"What is clear is that further work is needed from all interested parties to ensure that a workable consensus can be reached before the pensions issue really does become a crisis."