Open final salary pension schemes fall 2% The Pension Protection Fund (PPF) and the Pension Regulator have confirmed that the proportion of final salary pensions schemes that are still open to new private sector workers fell from 18% to 16% last year.
Furthermore nearly a quarter of existing schemes no longer allow their members to build up their pension funds. This was up from just over a fifth last year.
No more FTSE 100 firms have final salary pension schemes after Shell became the last FTSE 100 company to close their scheme to new staff.
The figures reveal that the closures of final salary schemes haven’t bee as widespread as earlier predictions from the National Association of Pension Funds (NAPF).
The finances of final salary pensions schemes recorded a surplus of £22 billion in 2010.
However, by the end of 2011, the deficit had actually grown to a record of £255 billion. By the end of December, there were over 6,500 private sector pension schemes, but only around 1,000 of the schemes were in surplus.
Experts suggest that whilst the deficit will not affect people’s pensions, companies will have to find the money to pay for them, and this is likely to impact on job growth in the country. It may also lead to further closures of final salary schemes as companies turn to cheaper pension options.
A spokesperson from NAPF indicated that the current situation doesn’t reflect the long term health of pension funds. However, they pointed out that it reflects the burdens that final salary schemes have on the private sector.
The PPF provides a safety net for pensions should an employer go bankrupt and leave a pension scheme with a significant deficit. The PPF indicated that there was a 46% fall in the number of schemes going through their bailout assessment process in 2010 − 2011. This was due to a drop in the number of businesses going bankrupt, but they warned that it could rise again following the slowdown of the economy since March 2011.
30 kidney transplants performed from living US donors
Patients in the US have completed the longest organ donor ‘chain’, enabling thirty people to receive kidney transplants from living donors. The transplants have potentially have saved their lives.
People who wished to donate a kidney to a loved one are sometimes unable to do so if they are not a good tissue match. Organs that are not well-matched are normally rejected by the patient’s immune system, and this can lead to patients waiting as long as a decade for a transplant. In many cases, patients who are on dialysis will die before a suitable organ is found.
A donor ‘chain’ allows a living relative of someone with kidney failure to donate to a stranger.
Another stranger in the same situation donates a kidney to their loved one in return.
The complex kidney donor chain was set up by Rick Ruzzamennti in California. In total, the process took four months to complete and involved organ donors from all over the US. Kidneys were removed from donors and flown across the US to recipients for transplant operations.
At least one patient, Don Terry from Illinois, feared he would die within five years if a kidney was not found.
Although donor chains have taken place in the past, they commonly only involve a small number of people. Medical professionals have labelled this longer chain as ‘ground-breaking’.
Transplant surgeon Dr John Milner said the idea provided “the best way for patients with incompatible donors to be transplanted quickly with the best results.”
TUC warn of rise in unpaid overtime work for older workers
A recent report has revealed that there has been a rise in the amount of unpaid hours that some employees are putting in at work and the TUC warn that it has been more pronounced in older employees.
The amount of unpaid overtime work amounted to two billion hours in 2012 according to a recent study. There were 5.3 million employees who worked an average of 7.2 hours of unpaid overtime work every week – one million more people than in 1992, when records began.
However, the number of people in their 20s who worked unpaid overtime fell by a third over the previous decade, whilst it rose by over 60% for people between the age of 50 and 60.
Those undertaking more unpaid overtime work are more likely to be teachers, media workers, financial services managers and health and social services staff. The UK’s ‘long hours culture’ is also more prevalent in managers between the age of 30 and 50, according to the report.
It is estimated that the unpaid work amounts to nearly £30 billion in the UK economy. However, the number of unpaid hours worked could potentially be worth one million extra jobs and it has been suggested that it could be holding back job creation.
At present, unemployment is at a high level of 8.3% and the report suggests that rather than encouraging people to work more unpaid overtime, taking on more staff would be far more productive.
The TUC argue that working excessive hours is likely to cause more stress and low morale to employees, leading to further health problems. They are calling for employers to encourage their staff to leave work on time.
The TUC point out that fears over a loss of income is also prompting older workers to work beyond their retirement age.
Brendan Barber from the TUC suggested that unpaid overtime was becoming the norm in ‘far too many workplaces.’
British Airways price fixing penalty slashed to just £58.5m
The Office of Fair Trading have made a concession to British Airways after management assisted with its probe into the artificial escalation of fuel surcharges paid by passengers.
Between 2004 and 2006 the airline colluded with Virgin Atlantic, exchanging commercial sensitive data and pricing information in order to artificially charge more. The fuel charges passengers had to pay soared from £5 per flight to around £60 per flight. At the time, both airlines claimed that the surcharges were necessary because of the rapidly rising price of oil.
The OFT, who regulate against commercial monopolies, originally issued a record £121.5 million fine to British Airways five years ago because of its role in pushing up prices for fuel artificially. It was also fined an additional £66 million in the US, a sum which has already been paid. As British Airways admitted liability and assisted in the investigation, the OFT today slashed the fine to £58.5 million, saying that the investigation was easier and quicker to complete with British Airways’ co-operation.
Virgin Atlantic was not fined as it initially revealed the price fixing to the OFT in 2006. In return for reporting the situation, the OFT granted it immunity. British Airways and Virgin Atlantic were both also fined in Nigeria but the airlines succeeded in overturning the decision.
According to sources, the OFT took the current financial climate into account when cutting the cost of the penalty levied against British Airways. However, British Airways chief executive Willie Walsh had also launched a PR and legal campaign to have the amount reduced.
In 2010 the OFT attempted to take four British Airways executives to court over the affair. The case was thrown out by the judge one year later as the prosecution failed to reveal more than 70,000 documents gathered from Virgin computers, but not before the trial had cost the British taxpayer £1 million.
In total, the price fixing investigation has lasted more than five years, and the decision to cut the fine has finally brought it to a close. Some legal experts are dissatisfied with the lack of prosecutions, as well as the apparently generous immunity granted to one airline and greatly reduced financial consequences for the other.
Senior director of Cartels and Crinimal Enforcement at the OFT, Ali Nikpay, said that the fine “sends out a strong message that co-ordinating pricing through the exchange of confidential information between competitors is unlawful.”
Customers who flew long haul with British Airways or Virgin Atlantic between August 2004 and January 2006 should be due a refund of some of the fuel surcharge they paid under a special class action lawsuit brought against both companies. The amount available varies between £2 and £10 per flight, and more than 5 million people could be eligible to receive compensation under the agreement. The closing date for refund applications is 31 December, and customers who believe they are entitled to claim should visit www.airpassengerrefund.co.uk. Claims can be made by post or online and must be made by the person who bought the tickets.