They’re Coming for the Pensioners

They’re Coming for the Pensioners

In a bid to reduce deficits, governments are increasingly looking at nationalising, appropriating or defaulting on private sector pension funds or on their future obligations. Consider:-

  • Argentina nationalises pensions. In 2008, private sector pensions to the value of $29B were taken over by the state in outright confiscation in order to maintain spending
  • Hungary. In 2010, £14B of private sector pensions were appropriated by the state in order to cut the budget deficit and avoid spending cuts
  • Ireland: Since 2010, the state government has imposed a jobs levy on private sector pension funds; currently 0.15%
  • Poland: The government appropriated $37B of government bonds held in private pensions and then promptly cancelled them in order to pay off sovereign debt
  • Detroit: Following the City’s bankruptcy in 2013, $9B of unfunded City pension obligations were cancelled.
  • Japan: – Government debt is now the highest in the world @ 230% of GDP; much of it financed by bonds purchased by Japanese pension funds. How will the government make good on these bonds? Most likely by inflation or default.
  • UK: – For the past 8 years, there have been continued reductions in allowable tax efficient pension contributions and lifetime allowances [wef Apr14, £1¼M lifetime limit and £40K contributions pa].

You do not have to be subject to these arbitrary restrictions and caps and you can plan for a wealthier retirement. Contact us for further information.

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