Public sector workers could face a renewed battle over pensions after the Bank of England became the first high-profile public institution to announce plans for scrapping its final-salary scheme, reports The Times.
In a leaked internal memo, the Bank proposes to replace its generous final-salary scheme for all new employees with a pension based on average salary.
It also wants to increase the retirement age from 60 to 65 and remove a perk that allows employees to retire early and claim their pension without penalty. It said that the move was necessary to help to plug a £300m deficit in its pension fund.
Pension experts said that the move was significant because the Bank’s scheme is widely seen as a gold standard in the public sector.
SLIGHTLY SOFTER THAN EXPECTED inflation figures did little to dissuade economists that the Bank of England will raise interest rates probably by a quarter point, by the end of the year, reports The Independent.
Sterling traded near its strongest since 1981 and posted its biggest gain against the dollar in a week.
“The Bank of England gave a clear message last week they can't rule out raising rates to 6%,” said Gavin Friend, head of currency strategy at Commerzbank.
Figures from the Office for National Statistics showed that factory-gate prices grew 0.2% last month, from 0.4% in May. Year-on-year prices rose 2.4%.
Howard Archer, UK economist for global insight, said: “It is really the future strength of consumer spending, wages and consumer price inflation that will determine whether or not interest rates reach 6%.
"These have continued to be robust."
BP HAS FROZEN £2M WORTH of payments to its former chief executive, Lord Browne, and outgoing refining boss, John Manzoni, ahead of a court battle with angry investors who claim the two mismanaged the company, reports The Guardian.
Lawyers for the shareholders are seeking damages in an Alaskan state court following costly oil spills in Alaska and a fatal explosion at the Texas City refinery that sent the share price sliding in the world's third-largest listed western oil group.
“We volunteered a temporary freeze with the agreement of both John Browne and John Manzoni,” said a BP spokesman who pointed out that Lord Browne had already lost out on the chance to obtain up to £15m through various incentive plans to which he was originally entitled.
Lord Browne has, nevertheless, walked away with a £1m a year pension.
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Two global vehicles
'Further plug advice gap'
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