Theresa May Talks Tough On Pensions

2 May 2017

protecting money.jpg This week has seen Theresa May announce plans to protect company pensions from unscrupulous bosses if she wins the election. The plans will see the powers of regulators increased, including large fines for those employers that deliberately underfund their schemes.

The move comes after the BHS pension scandal which saw the billionaire Sir Philip Green sell British Home Stores for £1 in 2015 with it later going into administration with a pension deficit of £571 million. Talking at an election rally, Theresa May said:

"Today I am setting out our plans, if elected, to ensure the pensions of ordinary working people are protected against the actions of unscrupulous company bosses. Safeguarding pensions to ensure dignity in retirement is about security for families, and it's another example of the choice in this election. Strong and stable leadership delivering for Britain, or a coalition of chaos led by Jeremy Corbyn, which can't get the right deal for Brexit, and risks our growing economy with higher taxes, fewer jobs, more waste and more debt."

The Institute of Directors gave a cautious welcome to plans saying BHS highlighted 'vulnerability' in the current system. "Mergers and acquisitions are a vital part of a dynamic economy but directors should also remember their responsibilities to staff, past and present," the organisation said in a statement. "Greater oversight for the regulator could help to protect pensioners without slowing down too much the wheels of commerce."

The Triple Lock

However, Theresa May was not so clear as to her plans for the state pension triple lock. The triple lock ensures the state pension increases in line with wages, inflation or by 2.5 percent - whichever is highest. Popular with pensioners, many of whom are traditional Tory voters, it has also been called unaffordable by many pension experts including the former Tory pensions minister Baroness Ros Altmann. Speaking back in 2016, she said:

"I believe the triple lock has fulfilled its purpose and suggested, as pensions minister, that the next Parliament needs to secure those gains, but a triple lock is not necessary for that anymore. In fact, in some ways, having the triple lock has been used as an easy symbol for politicians to point at to claim they are looking after pensioners. This can sometimes mean they do not believe they need to engage in more serious and in-depth policymaking for the ageing population. Such totemic symbols may be politically convenient, but are not a sound substitute for carefully considered policy reform."

When asked this weekend about her plans for the triple lock, Theresa May said that it would all be made clear in their forthcoming manifesto:

"Under a Conservative government, the state pension will still go up every year of the next parliament," she said.

"Exactly how we calculate that increase will be for the manifesto, and as I have just said you will have to wait for the manifesto to see what's in it."

  • Author Profile
    • Sp avatar Rupert Wynne

      Rupert is Smart Pension's marketing team manager. Working across all marketing verticals to support the business's growing requ…