Today the Social Housing Magazine "Inside Housing" led with a report that housing organisations are to challenge a threat to their workers' pensions.The Pension Trust which administrates the Social Housing Pension Fund (and many other Community and voluntary sector pension funds) is being blamed for attempting to force employers to close decent defined benefit schemes and force them to open less secure defined contributions schemes. This is supposed to be about rising pension "deficits".
To be fair to the Pension's Trust I have had conversations with people closely connected with the Trust and they say that they are fully committed to keeping these schemes affordable and open.
This morning I posted these comments on the Inside Housing website.
"While it is good news that Housing organisation are going to fight to protect their pension schemes it is absolutely vital that everyone understands that these “deficits” are frankly meaningless.
The cost of pension schemes is measured by a discredited and outdated accounting system called “Mark to Market” which even the Pensions minister Steve Webb described as a “Nightmare” which is “killing” perfectly good schemes. He has promised “not to stand “idly by” and to do something.
All employers and defined benefit pension schemes must not panic or over react. They should be working jointly with the trade unions to resolve this temporary problem. Remember closing the scheme will not get rid of the deficit. It can make it even worse.
Modern defined benefit pension schemes are as sustainable and affordable now as they have ever been.
John Gray Branch Secretary UNISON Greater London Housing Association Branch"
