Brits to mandate Employer 3% of pay contrib, as GOP/US C of C screws EE's

[papau]

You have to love todays reports from the UK and the US on pensions.

In the UK the Guardian reports that the soon to be released white paper on pensions will call for among other things, auto-enrollment and a minimum of 3% contributions by employers into the pension plans of employees. The white paper will require employers to contribute a minimum of 3% to employee pensions, if the employee does opt out. Otherwise the 3% would be in addition to the employee contributing 4% and the state, 1%, as tax relief.

Meanwhile in the US the staff of the Chamber of Commerce in a memo indicate that the pension conference on the proposed new law to "strengthen our pension system" is going well as House Majority Leader John Boehner refuses to accept mandates for employees but does demand the companies pay a "price" for comprehensive clarification of hybrid plans - the clarification being a retroactive making legal of the past cash balance plan replacement of a standard defined benefit plan, screwing older workers so as to improve the bottom line, as was done by IBM and others in the past. It is already agreed that the GOP will make legal future changes to corporate pension plans that do such screwing of older workers via conversion to cash balance plans. I'd love to see our media take an interest in Boehner's "price" - and try to find out how it differs from a bribe, and indeed tell us how to distinguish money given the GOP as support - the equivalent of free speech - and what is a bribe. But I do not expect our media to push government funding of elections anytime soon since our media is really just corporate controlled bribers themselves (isn't media deregulation and the end of the fairness rule improving our media?)

The rest of the pension changes are items that have minor effects but sound like something is being done - such as "smoothing" and "tying to credit rating" and "credit balances" and "transition periods".

The GOP love of defined contribution plans means that we are all optimistic about getting "solutions" that the industry favors for the defined contribution plan issues.

Isn't that nice!

If they are lucky the final drafting will occur over the Memorial Day break with a vote in June.

[antigop]

1. Do you have a link to said memo?

n/t

[papau]

3. no - not a public one n/t

n/t

[mcscajun]

2. I'd love to see somebody take on the "cash balance conversions"

that were done in the late 80s, early 90s. They screwed a LOT of us over with that one.

When my former employer did such a conversion, I did the math rather quickly. The "Cash Balance" of my new plan amounted to five years of future payments due in then-present-day dollars. Five Years! That was all.