Eight out of 10 of the UK‘s top companies provide directors with pensions that can pay out in full at 60 and are worth, on average, 26 times those of most employees, according to the TUC.
The TUC’s analysis of the annual reports of more than 50 of the UK‘s leading companies published today shows that 98% of their final salary pension schemes for executives have a normal retirement age of less than 65.
In just 80% of the company schemes all directors could retire at 60 without their pension being reduced. Only in one company do some – though not all – executives have to work until they are 65, the analysis shows.
The research also shows that directors’ final salary pensions are most likely to build up twice as fast (1/30ths) as the most common rate for employees in final salary schemes (1/60ths), meaning that it takes twice as many years for staff to reach a full pension as it does directors.
The TUC research reveals that directors of the UK‘s 100 most important companies have amassed pensions worth a total of £9bn which, on average, would pay out £167,000 a year if claimed now. This is more than 26 times the national average of £129 a week (£6,344 a year) and 30 times the average public sector pension.
TUC general secretary Brendan Barber used the research findings to hit back at business groups which recently criticised the government for allowing existing public sector workers to retire at 60.
“Britain‘s boardrooms are secure in a pensions ivory tower. Top bosses can expect to live long retirements on luxury pensions that are far more generous than their employees can expect,” he said.
“They should stop lecturing the rest of us on how we should get smaller pensions from a higher retirement age. After these revelations it is hard to see how their voice can carry much weight in the pensions debate.”