Private pensions provision in the UK is in crisis. Through a political economy perspective, this book explores how financial security in retirement has been endangered through the response of policy-makers to wider social and economic change, making a unique contribution to our understanding of financialization, neoliberalism, and the welfare state
Private pensions provision in the UK is in crisis, yet it is not the crisis often depicted in political and popular discourses. While population ageing has affected traditional pensions practice, the imperilment of UK pensions is due in fact to the peculiar way policy-makers have responded to wider social and economic change. Pensions are a mechanism for managing failed futures, yet this function is being impeded by the individualization of provision. This book offers a political economy perspective on the development of private pensions, focusing specifically on how policy elites have sought to respond to perceived crises of demographic change, under-saving, and fund deficits, and in doing so have absorbed imperatives to subject individuals to a market-led regime under the influence of neoliberal ideology. This terrain is explored through chapters on the historical and comparative context of UK pensions provision, the demise of collectivist provision, the rise of pensions individualization and the state's role as facilitator and regulator in this regard, and the financial and economic context in which pensions provision operates. By placing the UK system in a comparative context of pensions reform agendas across the world, this book offers an original understanding of the unique temporality and materiality of pensions provision as a set of mechanisms for coping with generational change and forecast failures in capitalist economies. It also presents a nuanced account of the extent to which the state acts to anchor the process of pensions rematerialization and, crucially, concludes by outlining a coherent and radical programme of progressive pensions reform.
Praise for Pension Revolution "When Keith Ambachtsheer puts his keen mind to work on a problem, watch out! Here he exposes today's fragile arrangements for the most serious social dilemma of our times--financing retirement. Then he provides a compelling and powerful set of solutions. His writings are essential reading for all who care about the future of American living standards." --Peter Bernstein, founder and President, Peter L. Bernstein, Inc., and author of Capital Ideas and Against the Gods "This book describes one of the most ingenious inventions in the history of mankind: pension funds offering credible promises about old-age income. It reads like a thriller: how can well-governed pension funds be created in an imperfect world in which mortals wrestle with foibles and moral shortcomings? One of the world's leading experts on pensions searches for the answer--and finds it." --Lans Bovenberg, Scientific Director, Network for Studies on Pensions, Aging, and Retirement, Tilburg University, The Netherlands "Pension Revolution exposes the inadequacies of current pension systems and persuasively makes the case for the fundamental changes that are needed. It is essential reading for both the pension industry and policymakers." --Elizabeth Bryan, Chair, Investment Committee, Unisuper Management PM Ltd, Australia "Most analyses of complicated issues deal with complexity by simplifying or only looking at one piece-part, and, in doing so, provide limited value. In stark contrast, Keith Ambachtsheer boldly wades into the complexity in Pension Revolution to come up with a valuable integrative solution. He is a most welcome revolutionary!" --Roger Martin, Dean, Joseph L. Rotman School of Management, University of Toronto, Canada "We have known Keith for over ten years, and consistently over that time, he has constructively and comprehensively challenged conventional wisdom. He has done this so effectively that many of his initial thoughts have now become universally accepted norms. Such is his energy however that he continues to push the boundaries of pension and investment thinking." --Peter Moon, Chief Investment Officer, Universities Superannuation Scheme Ltd, UK "Pension Revolution not only explains the shortcomings of the existing pension system and the underlying design features that have resulted in the current pension upheaval. It also offers thoughtful and creative suggestions for prospective pension design. A must-read for anyone interested in the future of retirement finance." --James Poterba, Professor of Economics, Massachusetts Institute of Technology and a member of the TIAA-CREF Board of Trustees
Fran Hawthorne, author of Pension Dumping, is a recipient of the New York State Society of Certified Public Accountants award for Excellence in Financial Journalism for 2009—the first year books have been honored. Pension plans in America no longer represent commitments that financially troubled companies will honor. Neither bankruptcy courts, nor Washington, nor unions have the clout to make them do so. The disposition of these plans is instead left to serve the needs of big investors. Often these investors are a failing company’s best hope of restructuring after bankruptcy. Investors want a lean investment unburdened with financial promises to employees no longer on the payroll. Despite laws passed to discourage the termination of plans, the courts allow it, caving in to the forces garnered to reinvigorate a failing company. Unions are often compelled to choose between the financial welfare of retirees and jobs for active workers. Pension Dumping explains in shocking detail how terminating the pension plan became a knee-jerk strategy for bankrupt companies that hope to attract big investors to help them reorganize. Hawthorne traces the dynamics and the players involved as a pension is targeted for termination: thebankruptcy court and the hierarchy of power that dictates whose interests will prevail the choices forced on unions the burden placed on the Pension Benefit Guaranty Corporation the risks investors take and the returns they look for the companies’ efforts to salvage what they can as they restructure, as well as the backlash they risk by breaking pension promises In 2008, Pension Dumping was cited in testimony before a Congressional committee investigating bankruptcies in relation to pensions.
