Baby boomers aren’t to blame for today’s workers’ woes

http://www.theguardian.com/money/2015/sep/15/baby-boomers-not-to-blame-for-today-workers-woes

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Phillip Inman continues the drip-drip assault on the financial security of older people (No pay rise? Blame the baby boomers’ gilded pension pots, 14 September). Can we recall that the final-salary pensions that many older people benefit from were part of their contract of employment, and were contributed to with this understanding during people’s working lives. It is disingenuous in the extreme to present retired people as the primary reason why working people today are finding it tough financially.

Yes, in many ways older people did benefit from financial advantages that younger people today do not enjoy, such as lower house prices, or higher-education opportunities that were free at source, but they were not the prime movers in these developments; governments and economists were.

Baby boomers did not determine the rates at which they made contributions to their pension schemes, nor were they responsible for the financial policies of those schemes: I vividly recall an insurance expert explaining to me – as long ago as 1977 – that the pensions industry was built on reckless assumptions.

As well, some occupational pension schemes were raided by organisations wishing to access easy cash: the Mirror Group perhaps being one of the few that was actually caught out by this, but by no means the only culprit. And if we want to look for reasons why the wages of ordinary working people are not growing at the same rate as productivity, we might do better to consider current conditions of employment in many industries, and the general flow of wealth over the last 30 or so years from the ordinary working population to the mega-rich.Paul GriseriGosport, Hampshire

• Phillip Inman blames pensioners for current pay rates. They are former workers who paid contributions and expected their terms of employment to be honoured. Surely this is how it should be. Blame could be apportioned to governments for weakening trade unions and legal terms of employment, to banks’ illegal and grasping behaviour and to employers. “Black holes” were not left by workers; employers took “holidays” from contributions to pension funds which have come back to haunt them. None of this is the fault of pensioners.

Are all former workers “among the wealthiest pensioners in the world”? Many former workers (especially women) remain poor.

Wages and working conditions (except for the few) have been remorselessly pushed down by governments and employers, unimpeded by weakened unions. Does Phillip Inman really believe that impoverishing pensioners (who have no means of redress) would help the situation?

The so-called “baby boomers”, lumped together regardless of circumstances, are a convenient scapegoat he seems all too keen to sacrifice.Marcia WheelerLondon

• Phillip Inman returns to a subject that politicians seem to avoid. Retirees have done well compared with those who work in recent years. Politicians may fear that the older generation may punish them at the ballot box if they redress the balance, but older people have children and grandchildren, and many want to see fair play in the nation’s economy. There is a simple way of shifting the balance between old and young. At present, when people reach pension age, they stop paying national insurance contributions. I suggest that they should continue to pay.Robert EastLondon

• Companies give pay rises because they are required to by the minimum wage law, as a result of union pressure, or because they have to attract and retain the staff they require in the current jobs market. I don’t know why Phillip Inman believes that if companies were not compelled to pay off the deficit in their pension funds they would instead give the money to their current employees rather than their shareholders.David LynchWantage, Oxfordshire

• British Airways, which is owned by Spanish-registered IAG, does not have one pension scheme but two; the Airways Pension Scheme (APS) dating from 1948 and the New Airways Pension Scheme (NAPS) dating from 1984. In its half-yearly accounts, IAG reported that, at 30 June 2015, APS was in €1.333bn accounting surplus, while NAPS was in €777m deficit. The average APS pension is about £14,000 pa. The average NAPS pension is about £12,000 pa.

British Airways took a legitimate 14-year contribution holiday from APS from 1989 until 2003. Male flying staff continued to pay full contributions amounting to 8.5% of pay. BA took a further £336m from the APS surplus in 1989 to settle a pay claim using an improperly introduced pension fund rule – see Hansard’s report of this week’s extremely well-attended House of Commons adjournment debate on BA and pensions uprating.Captain Mike PostFormer APS trustee; chairman, Association of British Airways Pensioners

• Phillip Inman is probably too young to remember the numerous “pension contribution holidays” that employers awarded themselves to boost profits in the good times, when final-salary funds were in surplus. Many of us observed then that this behaviour was like that of Aesop’s grasshoppers and that harder times would come again. Now that they have, it is more than ironic that former employees are being blamed and that a bogus narrative of intergenerational injustice is being spun. Present-day workers should not be paying the price for past employer greed.Robert DingwallNottingham

• Phillip Inman lays the blame for low wages on retired baby boomers and their employers. How come, when the baby boom generation have worked for 45 years or more and have had their compulsory pension contributions deducted from their wages? If the employers failed to make sufficient provision for the payback, why is the pensioner to blame? It’s a bit like blaming the migrant crisis on the refugees. David SimpsonDatchet, Buckinghamshire