Personnel Today
  • Home
    • All PT content
  • Email sign-up
  • Topics
    • HR Practice
    • Employee relations
    • Learning & training
    • Pay & benefits
    • Recruitment & retention
    • Wellbeing
    • Occupational Health
    • HR strategy
    • HR Tech
    • The HR profession
    • Global
    • All HR topics
  • Legal
    • Case law
    • Commentary
    • Flexible working
    • Legal timetable
    • Maternity & paternity
    • Shared parental leave
    • Redundancy
    • TUPE
    • Disciplinary and grievances
    • Employer’s guides
  • AWARDS
    • Personnel Today Awards
    • The RAD Awards
  • Jobs
    • Find a job
    • Jobs by email
    • Careers advice
    • Post a job
  • Brightmine
    • Learn more
    • Products
    • Free trial
    • Request a quote
  • Webinars
  • Advertise

Personnel Today

Register
Log in
Personnel Today
  • Home
    • All PT content
  • Email sign-up
  • Topics
    • HR Practice
    • Employee relations
    • Learning & training
    • Pay & benefits
    • Recruitment & retention
    • Wellbeing
    • Occupational Health
    • HR strategy
    • HR Tech
    • The HR profession
    • Global
    • All HR topics
  • Legal
    • Case law
    • Commentary
    • Flexible working
    • Legal timetable
    • Maternity & paternity
    • Shared parental leave
    • Redundancy
    • TUPE
    • Disciplinary and grievances
    • Employer’s guides
  • AWARDS
    • Personnel Today Awards
    • The RAD Awards
  • Jobs
    • Find a job
    • Jobs by email
    • Careers advice
    • Post a job
  • Brightmine
    • Learn more
    • Products
    • Free trial
    • Request a quote
  • Webinars
  • Advertise

Latest News

Directors still keen on final salary pension schemes

by Personnel Today 15 Jun 2004
by Personnel Today 15 Jun 2004

Given
the choice of a final salary pension, a cash alternative, or a money purchase
pension, nine out of 10 company directors choose final salary schemes,
according to a survey by actuaries Lane Clark & Peacock (LCP).

Companies
are now set to consider changes to the pensions element of executive reward
packages in the face of the new pension taxation regime that will be introduced
from 6 April 2006.

There
will be no limits on the amount of pensions savings, but where the value of an
individual’s pension savings within registered schemes exceeds £1.5m there will
be an additional tax charge of 25 per cent on any savings above that amount.

Although
many executives would prefer a cash alternative where the 25 per cent tax
charge is likely to arise, the LCP survey suggests that executives may be
reluctant to switch.

Mark
Jackson, a partner at LCP, said: “Many in the pensions industry believe
executives will take a cash alternative where additional tax charges arise, but
the survey suggests the industry should think again.

“Directors
are not going to give up their final salary pensions easily, and it may not be
in the best interests of the director or the company to do so. A cash
alternative incurs additional National Insurance for both parties, and it takes
a large amount of cash to replace a pension by purchasing an annuity outside of
the pension scheme."

The
survey found that although the shift from final salary (defined benefits) to
defined contribution pensions continues, the pace of change has slowed.

According
to LCP, in 1999, fewer than 5 per cent of companies offered defined
contribution schemes to some or all of their executive directors. However, by
2002, the proportion had increased to 40 per cent, and in this year’s survey
was 47 per cent.

Sign up to our weekly round-up of HR news and guidance

Receive the Personnel Today Direct e-newsletter every Wednesday

OptOut
This field is for validation purposes and should be left unchanged.

www.lcp.uk.com

By Quentin Reade

Personnel Today

Personnel Today articles are written by an expert team of award-winning journalists who have been covering HR and L&D for many years. Some of our content is attributed to "Personnel Today" for a number of reasons, including: when numerous authors are associated with writing or editing a piece; or when the author is unknown (particularly for older articles).

previous post
UK leads new wave of offshoring activity
next post
Staffordshire Sentinel Newspapers Limited v Potter, EAT, 18 March 2004

You may also like

How to stop flying blind with workforce planning

3 Sep 2025

Specsavers director suspended over wrongful expense claims of...

3 Sep 2025

New ‘failure to prevent fraud’ law a ‘game-changer’

2 Sep 2025

PCs removed from firearms unit after Tallia Storm...

2 Sep 2025

Top 10 HR questions August 2025: Conduct outside...

2 Sep 2025

Nestlé sacks CEO over ‘undisclosed’ romantic affair

2 Sep 2025

Revolut employees to receive share sale payout

2 Sep 2025

Personnel Today Awards 2025 shortlist: Health and wellbeing

2 Sep 2025

Deloitte to hire 1,500 graduates and apprentices

2 Sep 2025

Airbus strikes postponed after new pay offer

1 Sep 2025

  • Work smart – stay well: Avoid unnecessary pain with centred ergonomics SPONSORED | If you often notice...Read more
  • Elevate your L&D strategy at the World of Learning 2025 SPONSORED | This October...Read more
  • How to employ a global workforce from the UK (webinar) WEBINAR | With an unpredictable...Read more

Personnel Today Jobs
 

Search Jobs

PERSONNEL TODAY

About us
Contact us
Browse all HR topics
Email newsletters
Content feeds
Cookies policy
Privacy policy
Terms and conditions

JOBS

Personnel Today Jobs
Post a job
Why advertise with us?

EVENTS & PRODUCTS

The Personnel Today Awards
The RAD Awards
Employee Benefits
Forum for Expatriate Management
Whatmedia

ADVERTISING & PR

Advertising opportunities
Features list 2025

  • Facebook
  • Twitter
  • Instagram
  • Linkedin


© 2011 - 2025 DVV Media International Ltd

Personnel Today
  • Home
    • All PT content
  • Email sign-up
  • Topics
    • HR Practice
    • Employee relations
    • Learning & training
    • Pay & benefits
    • Recruitment & retention
    • Wellbeing
    • Occupational Health
    • HR strategy
    • HR Tech
    • The HR profession
    • Global
    • All HR topics
  • Legal
    • Case law
    • Commentary
    • Flexible working
    • Legal timetable
    • Maternity & paternity
    • Shared parental leave
    • Redundancy
    • TUPE
    • Disciplinary and grievances
    • Employer’s guides
  • AWARDS
    • Personnel Today Awards
    • The RAD Awards
  • Jobs
    • Find a job
    • Jobs by email
    • Careers advice
    • Post a job
  • Brightmine
    • Learn more
    • Products
    • Free trial
    • Request a quote
  • Webinars
  • Advertise