Three Towards a new pension settlement? Recent pension reform in the UK
-
Debora Price
Abstract
In December 2002, the Labour government announced the formation of the Pensions Commission. In 2005, the Commission published comprehensive proposals for pension reform in their second report and it was a remarkable achievement; the proposals gained a broad acceptance from the government and opposition parties, trades unions, employer organisations, the insurance industry, special interest groups and the voluntary sector. In November 2006, the reform packages began to crystallise with the introduction of the first Pensions Bill which eventually became the 2007 Pensions Act. In 2007, the government published the second Pensions Bill, which at the time of writing aims to reform the private and occupational pension system, to take effect from 2012. Although this Bill attracted more controversy, there is again a substantial political and stakeholder consensus for the broad content. All reforms are incremental to the existing system, yet the reform package has the capability to alter the pension landscape dramatically. This chapter discusses the implementation of these reforms to the state pension after the major Turner Commissions on Pensions. It documents the decline of defined benefits in favour of defined contributions schemes, together with the new development of Personal Accounts and an assessment of their likely impact. In conclusion, the chapter suggests that the new pensions structure is a return to the Beveridge flat-rate system. Furthermore, it suggests that low earners and those with intermittent employment records may make ‘bad’ decisions about their pensions due to lack of clear guidance and advice available to this group. This may result in increasing inequalities between public and private pensions provision.
Abstract
In December 2002, the Labour government announced the formation of the Pensions Commission. In 2005, the Commission published comprehensive proposals for pension reform in their second report and it was a remarkable achievement; the proposals gained a broad acceptance from the government and opposition parties, trades unions, employer organisations, the insurance industry, special interest groups and the voluntary sector. In November 2006, the reform packages began to crystallise with the introduction of the first Pensions Bill which eventually became the 2007 Pensions Act. In 2007, the government published the second Pensions Bill, which at the time of writing aims to reform the private and occupational pension system, to take effect from 2012. Although this Bill attracted more controversy, there is again a substantial political and stakeholder consensus for the broad content. All reforms are incremental to the existing system, yet the reform package has the capability to alter the pension landscape dramatically. This chapter discusses the implementation of these reforms to the state pension after the major Turner Commissions on Pensions. It documents the decline of defined benefits in favour of defined contributions schemes, together with the new development of Personal Accounts and an assessment of their likely impact. In conclusion, the chapter suggests that the new pensions structure is a return to the Beveridge flat-rate system. Furthermore, it suggests that low earners and those with intermittent employment records may make ‘bad’ decisions about their pensions due to lack of clear guidance and advice available to this group. This may result in increasing inequalities between public and private pensions provision.
Chapters in this book
- Front Matter i
- Contents iii
- List of tables and boxes v
- List of abbreviations vi
- Notes on contributors viii
- Introduction 1
-
Current developments
- A year of transition in post-compulsory education and training 11
- Planning for infrastructure and housing – is sustainable development a dream? 35
- Towards a new pension settlement? Recent pension reform in the UK 51
- Climate change and climate change policy in the UK 2006–07 69
- Policy for older people in Wales 93
-
Current debates
- Flexibility or flexploitation? Problems with work–life balance in a low-income neighbourhood 113
- The role of confidence and identity in civic participation: exploring ethnic group differences 133
- The problem of riches: is philanthropy a solution or part of the problem? 151
- Policy from the pitch? Soccer and young refugee women in a shifting policy climate 173
- Social citizenship in post-liberal Britain and post-corporatist Germany: curtailed, fragmented, streamlined, but still on the agenda 191
-
Engendering policy and politics
- Gender and New Labour: after the male breadwinner model? 215
- A review of engendering policy in the EU 241
- Forming Australian families: gender ideologies and policy settings 263
- Working fathers as providers and carers: towards a new conceptualisation of fatherhood 279
- Index 297
Chapters in this book
- Front Matter i
- Contents iii
- List of tables and boxes v
- List of abbreviations vi
- Notes on contributors viii
- Introduction 1
-
Current developments
- A year of transition in post-compulsory education and training 11
- Planning for infrastructure and housing – is sustainable development a dream? 35
- Towards a new pension settlement? Recent pension reform in the UK 51
- Climate change and climate change policy in the UK 2006–07 69
- Policy for older people in Wales 93
-
Current debates
- Flexibility or flexploitation? Problems with work–life balance in a low-income neighbourhood 113
- The role of confidence and identity in civic participation: exploring ethnic group differences 133
- The problem of riches: is philanthropy a solution or part of the problem? 151
- Policy from the pitch? Soccer and young refugee women in a shifting policy climate 173
- Social citizenship in post-liberal Britain and post-corporatist Germany: curtailed, fragmented, streamlined, but still on the agenda 191
-
Engendering policy and politics
- Gender and New Labour: after the male breadwinner model? 215
- A review of engendering policy in the EU 241
- Forming Australian families: gender ideologies and policy settings 263
- Working fathers as providers and carers: towards a new conceptualisation of fatherhood 279
- Index 297
