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Arena Magazine 2006 Issue 1 January February |
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Retail pensions under pressure
Workers at the UK’s biggest Co-operative society – the Co-op Group – could be facing cuts in their future pension payouts after the company announced it is planning to ditch its three final salary pensions in favour of a single ‘career average’ scheme.
The plans to axe the final salary schemes will be put to the trustees with a view to an April 2006 changeover. (They also have to be approved by the Government's pension regulator). Benefits accrued under the current scheme will be protected.
"This decision appears to be at odds with the traditions of the Co-operative movement and their much vaunted ethical trading policy," said national officer Sharon Ainsworth.
"Usdaw has always had a good relationship with the Co-op Group so we're massively disappointed we've failed to reach a suitable compromise that protects our members' pensions. We put a very good case to the Co-op that by putting some more money into the pension scheme they could protect the retirement plans of their loyal staff but they have decided not to listen.
"Usdaw wants to make sure that our members can enjoy a retirement free of the fear of financial hardship. We will be speaking to our members to see what their reaction is to this fundamental change to their retirement plans."
The Group's three schemes, covering its banking, insurance and retail divisions have 98,000 members, with around 22,000 of these currently contributing to the pension funds.
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