US - General Motors Corporation (GM) cited "huge legacy costs" of retirement benefits as the reason for its slump that saw revenues fall from US$193.5bn to $192.6bn in 2005.
Earlier this year, GM announced changes which resulted in accrued benefits in the current pension plan being frozen. Instead, the company implemented a reduced defined benefits scheme for some employees and introduced a new defined contribution plan for the others.
According to the Wall Street Journal, however, the pension plans for GM’s US workers contain around $9bn more than is needed to meet their future obligations.
Reportedly it is the executives’ pension plan that is burdening the company with a $1.4bn liabillity. A Wall Street Journal analysis of corporate filings in fact revealed that executive benefits played a significant role in the decline of American pensions.
By Angele Spiteri Paris
PwC, KPMG, EY and Deloitte must break up their consultancy and audit businesses into distinct firms to provide greater focus on the "most challenging and objective audits", the competition watchdog has said.
The Department for Work and Pensions (DWP) has released its first batch of guidance setting out how the guaranteed minimum pension (GMP) conversion legislation may be used to resolve unequal payments.
This week's top stories include the government spending £800,000 on a Gogglebox advert and MPs writing to The Pensions Regulator about its engagement with the Railways Pension Scheme.