Pensions crackdown

The annual report of the Pensions Board has raised serious concerns about a significant drop of over 38,000 in the number of people with occupational pension schemes during the last two years.

Moreover, it has found that as many as 80% of the defined benefit schemes are in deficit, some in substantial deficit.

As a result of stock market turmoil and low interest rates, defined benefit pensions are disappearing in many countries.

The Pensions Board professes a determination to ensure that as many as possible of the defined benefit schemes are put on a secure footing. Maybe, if corporate executives had to depend for their own retirement security on the same pension fund as their workers, there might be fewer defined benefit schemes in deficit.

Although the Pensions Board professes a determination to take appropriate action to ensure compliance with the Pensions Act, prosecutions have almost entirely been confined to instances where employers deducted contributions from employees’ wages and did not pass that money on to the pension scheme.

In some instances, according to the report, offending companies have been put into liquidation, but the same directors immediately started up other companies. They continued to deduct pension contributions and keep the money rather than passing it on.

This should be intolerable.