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Compulsory Occupational Pension Scheme with Employer and Employee Contributions

“The Government should legislate that every employer in Britain should be required to provide an occupational pension scheme with final salary pension provision.”

2. How does it fit with Compass’ core beliefs of equality, solidarity, democracy, freedom, sustainability and well being?

There is a pensions time-bomb in Britain. We have allowed companies to make huge profits whilst allowing them to divest themselves of their pensions responsibilities to their employees. An increasing number of people in Britain will be living into very old age and they have a right to do so with dignity. The Government should act now and come together with business organisations in Britain to map out a future for pension provision. If businesses refuse to co-operate, then the Government should retain the option to legislate. Adequate pension provision is a human right.

3. How does it build the institutions of social democracy, like social groups and collective and cooperative forms of ownership and control?

Such provision will give employees more of a stake in the companies they work for, a knowledge that they are part of something bigger than themselves. Companies would have to compete not to see who can get away with the smallest pension provision (as of now, usually none) but who can offer the best as an incentive to employees.

4. How much will it cost or raise and where will any cost come from?

Employers will pay the bulk of these costs. Realistically, the Government may have to make a contribution at the beginning of this scheme, but that can be reduced as the scheme beds down.

5. Which groups in the electorate are likely to support or oppose this measure? Is there any polling evidence you have on this?

Everyone but employers and employer organisations will support this scheme. We will be told, like with the minimum wage, that they cannot afford it, that it will be a disaster, that it will lead to mass unemployment. Then the reality will take hold, which is that they can afford it.

6. Is there a place or country where it’s worked? Please provide some information.

We used to have such a voluntary system in this country. Employers then reneged on the system. It gave security and dignity to all UK employees. It should be re-instituted as a legislative entitlement.

7. What are the three main arguments in favour/against it?

1. We have a pensions time-bomb which the Government cannot fix alone.
2. Employers can afford it - if they can afford ludicrous bonuses and dividends, they can certainly afford this.
3. It will have huge popular support in the country.

This entry was posted on Thursday, January 22nd, 2009 at 1:48 pm and is filed under Wellbeing. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.