Sir, Britain had a private, funded, pension market which was the envy of the world. We had a cost-controlled state pension system which made our national finances far stronger than our European partners’. This has all gone in only six years of new Labour government. You say (leading article, June 12) that trust in the pension system is “fragile”. You are too charitable — trust has slumped.

I have been a consulting actuary for over 30 years. Before 1997, stockmarket slumps and ill-judged government interference (nothing new!) did not destroy our pension system. The real income of those retiring increased enormously. Employers and insurance companies then had the confidence to weather the financial storms, and pay the deficiency contributions in bad years. They do not now — why?

Employers see the Government raiding their long-established pension funds, and means-testing pensioners so the pensions they pay out give no real benefit to their former employees. Insurers have lost their financial viability in today’s compensation culture — billions of pounds lost in interminable “reviews” led by bureaucratic regulators. We need major and long-term changes, starting with Gordon Brown putting back the money he has taken, and setting a decent, non-means-tested, basic state pension.

Yours faithfully,
GEOFFREY WILSON,
Baldhorns Park,
Rusper, West Sussex RH12 4QU.
geoffreywilson@dial.pipex.com
June 23.

From Mr George Garside

Sir, Robert Hicks (letter, June 17) states that most modern companies prefer to empower their staff to manage their own pension funds. Empowerment, in this case, is simply a euphemism for dumping responsibility for pension provision.

The alternative system of individual pension funds has two major flaws, which taken together probably account for the lack of wide take-up of such schemes, including the much-vaunted stakeholder plan.

First, individual schemes are wide open to the charges and vagaries of the financial services industry, whose track record leaves a great deal to be desired.

Secondly and most importantly, a huge proportion of the working pop-ulation do not receive sufficient re-muneration to enable them to build up a worthwhile personal fund, and are, if the present ethos continues, likely to suffer the indignity of living on meagre means-tested benefits in retirement.

The only viable solution is a complete revamping of the state pension to a fixed level, say 40 per cent, of average earnings. Most people would be happy to contribute towards this on a pay-as-you-go taxation basis, secure in the knowledge that they would be neither means-tested in retirement, nor fleeced by financial advisers driven by sales-related remuneration.

Yours sincerely,
GEORGE GARSIDE,
87 Gardner Road,
Formby, Merseyside L37 8DE.
June 18.

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