I DOUBT whether Gordon Brown and Tony Blair have the faintest idea of the terrible trouble they are in. Restoring the earnings link and a decent basic state pension is an absolute political necessity, not a matter of opinion.
Very soon we baby boomers — and our generation cut our teeth in the 1960s on political activity — will discover what we can expect in retirement as a direct result of Mr Brown’s policies.
Labour will then be out of power in very short order, and will stay out for as long as the new pensioners keep voting.
George Edwards, Harrogate
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Long memories
MARGARET THATCHER removed the link between average earnings and the state pension, and replaced it with the RPI in 1980. The basic pension today would have been more than £100. Indeed, was this the first and biggest stealth tax of all? It is a nonsense to attribute all the woes of the pension schemes to Gordon Brown. William Rees-Mogg makes no mention of much more significant matters, such as employers’ contribution holidays, the dot-com bust, and international events which have depressed financial markets globally and reduced the assets of the pension funds.
Today’s new pensioners were only 40 years old when the real stealth damage was imposed, and you will find all our memories are still clear on that.
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Your columnist concludes that there will be two groups of pensioners at the next election. There will be a very significant third group: those who blame the Conservative Party.
Colin Foster, Ulverston, Cumbria
Bulls and bears
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WITHOUT disagreeing with much that William Rees-Mogg says, I feel that his argument is incomplete.
When there was a bull market, all companies, whose actuarial valuation of their pensions showed a big profit, stopped or reduced contributions; some even reduced employees’ contributions. Then the markets collapsed and the pensions were left with a big hole. Gordon Brown was not responsible for the bear market, I believe, so is not wholly to blame, therefore, for the shortfall in private pensions.
Graham Schuil-Brewer, kateetgraham@wanadoo.fr
The cult of youth
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CERTAINLY Gordon Brown’s irrational greed in abolishing the pension dividend credit contributed to the pensions crisis, as did the greed of the men and women running companies such as Shell, Enron and Equitable Life. But William Rees-Mogg overlooks the contribution of age discrimination to the impoverishment of older people.
Age-discrimination legislation has been intentionally delayed by the Government for nearly ten years, during which time millions of people in their 50s have stopped working, paying income tax and paying into their pensions. Many more have no jobs to retire from, and live on incapacity benefits, borrowing or savings, leaving them with nothing for old age.
The entire Labour Party, with its cult of youth, must take the blame, not just Gordon Brown.
Joyce Glasser, London NW3
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Working for nothing
I COMPLETELY endorse William Rees-Mogg’s assessment of the Chancellor’s actions. I am approaching my mid-50s, dismayed at the impact these past eight years will have had on retirement plans after a lifetime of hard work and endeavour.
Unfortunately, the story does not quite end there. I am also aware that the proceeds of these stealth measures have been poured into a public-spending chasm with little tangible return other than to swell the number of public- sector employees.
These will have been promised final-salary pension schemes for which there is insufficient funding, other than to increase further direct taxes such as council tax.
Not only will future pensioner incomes be blighted in the manner described, but also their expenses will be greater, with nothing to show for it in terms of improved services.
This country’s hard-earned wealth has been well and truly wasted.
Chris Baldwin, chris.baldwin@btinternet.com
Loss of trust
I DOUBT that there has ever been a Chancellor more overrated than the present occupant of 11 Downing Street.
The Times was never more accurate than its statement that the raid on pension funds was a gross breach of public trust.
The Chancellor is surrounded by sycophants such as Paul Boateng and Ruth Kelly, who have presided over huge increases in taxation, which will eventually make our economy uncompetitive. Blair should sack the lot of them.
Most of the young entrepreneurs I know absolutely refuse to save money through pension funds, believing that they will be plundered in some other way in the future.
David H. Peart, Hurworth-on-Tees, Co Durham
Disproportionate blame
THE occupational pensions system, cherished by so many, would not be in the sorry state it is today if, back in 1983, the Conservative Government had implemented the European Insolvency Directive to require the UK to put in place financial measures to protect workers’ pension benefits. Certainly, those members of the Allied Steel & Wire scheme would not have been so cruelly cast adrift without a financial lifeboat.
Further, let us not forget the introduction of the preservation requirements in the 1995 Pensions Act made it significantly more expensive for occupational pension schemes to be administered on a year-on-year basis, and did not the overly restrictive Inland Revenue requirements on the level of funding schemes could maintain lead many companies to take contribution holidays which diminished the pension fund surplus just at the time when equities began to tumble? It is too simplistic to lay the blame for the current pensions crisis solely at the doorstep of Mr Brown and his budget reforms. Greater emphasis needs to made of the many facets of the present situation.
Martin McFall, MMcFall@kilpatrickstockton.com
Bad language
WILLIAM REES-MOGG is spot on in his criticism of Gordon Brown’s stealth tax on pension funds.
However, the pension fund managers themselves must bear some blame in not communicating the root cause (Gordon Brown) of their difficulties to their members. The arcane language often used in pension fund communications with their members leads mostly to a despairing condemnation of the amorphous “them”, rather than identifying the real culprits — who might then be remembered when members next approached the ballot box.
Duncan Heenan, Isle of Wight
A Tory opportunity
AT LAST, William Rees-Mogg has clearly articulated the pensions catastrophe caused by Gordon Brown. He missed one point though; namely that the effect of Brown’s raid on pensions is tantamount to a new tax on those in the private sector but not those in the public sector.
I live in a city where nearly two out of every three employed people work for the public sector. At the beginning of this summer the local paper was full of grinning teachers, local government workers and others receiving early retirement plaudits. All of them were between the ages of 55 and 60. In the real world, the rest of us must work to 65, and prob-ably well beyond, in order to pay for their lengthy retirement.
The opposition has miserably failed to highlight this, and needs to campaign loudly on this and on Brown’s other stealth tax, the phenomenal increases in council tax. The message has got to get across that Brown has proved to be an economic disaster to everyone except the very rich, the very poor and the public sector.
He should forfeit his own pension, at very least, for his crimes.
Bruce H. Burniston, Swansea
A simple reminder
YOUR intrepid columnist asks today how new Labour is to gain the votes of oldies. Simple, just remind them of what happened to their pensions under Major and Thatcher.
Alan Carpenter, Chippyawc@aol.com