UK - Supermarket giant J Sainsbury is aiming to slash its early retirement costs by £6m a year.
The £2.62bn J Sainsbury Pension and Death Benefit Scheme says early retirement currently costs £14m a year.
But it believes huge savings can be made by requiring staff to give six months’ notice of their decision to retire early.
At a meeting of the firm’s pension consultative committee, the trustees said: “Previously when members left the company, for example to go to another employer, we offered an early pension.
“This costs a lot of money. In the future when six months’ notice is not given, then the offer will be a cash equivalent transfer value or a deferred pension to 65.”
Group pensions manager Geof Pearson told the meeting that the six-month rule could be relaxed on compassionate grounds, where discretion would be used.
Pearson believed the firm needed to change “the early retirement culture” in light of the government’s decision to raise the minimum age at which a pension could be taken to 55 in 2010. He said this could be done by communicating the benefits of retiring later – such as the opportunity to gain a larger pension and the ability to manage the work-life balance.
The People's Pension, Atlas Master Trust and The Cheviot Trust have been granted authorisation from The Pensions Regulator (TPR), taking the total number of authorised master trusts to 18.
Pension schemes have been warned they may now face a more challenging legal test if they wish to fix drafting errors.
The Greene King Pension Scheme has appointed XPS Pensions as its actuarial and investment adviser following a competitive tender process.
Professional Pensions has compiled a list charting the progress of master trust authorisation. View our list in full here...