Know your pensions

No-one should be more aware of the pensions’ timebomb than the HR profession, which administers and oversees how companies are providing for employees’ futures.

And while successive governments have avoided making the hard decisions the issue requires, the urgency of the current situation has led to signs that progress is now being made.

New legislation is being put in place that will enable people to put more away more for their retirement and allow employers to advise their staff about pensions.

Life expectancy is increasing rapidly and will continue to do so.

This is good news, but combined with a projected low birth rate, this will almost double the population aged 65 years and over between now and 2050, with further increases thereafter.

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To a certain extent, the baby boom has delayed the effect of these underlying long-term trends, which, according to the Pension Commission, will now mean 30 years of very rapid increase in the dependency ratio.

But it is obvious adjustments to public policy and individual behaviour that have to be made – ideally, that should have happened 20-30 years ago.

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Faced with the increasing proportion of the population aged over 65, society and individuals must choose between one of four options:



  • Pensioners will become the poorer relative to the rest of society
  • Taxes/National Insurance contributions devoted to pensions must rise
  • Savings must rise
  • Average retirement ages must rise.

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We all know these are the choices to be made.

But while you are mulling over the options, Personnel Today has collated a number of recent statistics and survey findings to help you get a better picture of the issues at hand and keep you better informed when discussing pension policies within your organisation.

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More charts were printed in Personnel Today, 29 March 2005



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