The UK employers association, the Confederation of British Industry (CBI) has attacked the demands made by trade unions at the conference of the governing Labour Party for employers to be compelled to make pension contributions on behalf of employees.
The CBI said employer compulsion could cost companies 29 billion a year, threaten the viability of some smaller businesses and fail to help people on low incomes. “Pensions are a serious problem but I find it staggering that some people still believe employer compulsion is the answer,” says John Cridland, CBI Deputy Director-General. “They are completely missing the point. Companies are trying hard to keep pensions going and do the right thing by employees even though the costs are getting out of control. Unions should be working alongside employers to make pensions cheaper, not fighting to make them more expensive. All compulsion would do is exacerbate the pensions problem and threaten the viability of many smaller firms. Many low income people could find themselves no better off as their contributions would not be enough to take them above social security benefit levels. The move could also restrict freedoms to make other kinds of investment to pay for retirement.”