Tag: flexibility

MPs call for new regulatory approach to secure thriving future for defined benefit pension schemes

Changes to proposed regulation and improvements in governance standards are urgently needed to ensure private sector defined benefit (DB) pension schemes remain an active and thriving part of the pensions landscape and work in the best interest of scheme members, MPs say today.

The Work and Pensions Committee report concludes that despite a steady decline in number in recent years, DB pension schemes are still of critical importance to both savers and the UK economy.

It warns however that two decades of regulatory and policy caution from DWP and The Pensions Regulator (TPR) have led to a low-risk approach to investment that threatens to inadvertently finish off the few remaining DB schemes still open to new members.

With an improvement in funding levels over the past decade presenting new challenges and opportunities for schemes, the report calls for a fresh approach both to funding regulation and the treatment of surpluses in pension and compensation schemes.

Among recommendations on the latter, the report calls for DWP and TPR to look at ways of ensuring the reasonable expectations of scheme members for benefit enhancement are met where there has been a history of discretionary increases.

On the new funding regime proposed by the Government to come into force in September, the Committee’s inquiry heard concerns that open schemes would be forced to de-risk unnecessarily, potentially leading to premature closure.

The Committee calls for the Government to address such concerns in the final version of the Funding Code and for TPR’s objective to protect the Pension Protection Fund to be replaced with a new duty to protect future, as well as past, service benefits.

PPF reserves now stand at £12 billion and the report calls for legislation to allow the levy to be reduced to zero and for compensation levels to be improved.

To encourage better governance, the Committee welcomes the introduction of a trustee register to improve TPR oversight. The report notes TPR’s view that consolidation, including through pension Superfunds, is one of the main ways to improve governance, and calls for the required legislation as soon as possible.

Rt Hon Sir Stephen Timms MP, Chair of the Work and Pensions Committee, said: “Defined benefit pension schemes are hugely important to savers planning for a comfortable retirement and for the UK economy.

“The improvement in scheme funding levels presents opportunities for both to benefit, but a new approach to regulation and governance is needed to protect the best interest of scheme members and allow still open schemes to thrive.

“The flexibility afforded by the much-improved financial position of the PPF, which we applaud, gives the Government an opportunity to ensure open schemes are not hindered by overly cautious restrictions imposed by regulations.

“While many trustee boards operate to high standards, new standards for trustees can foster confidence that this is the case across DB schemes.”

The report follows up on some of the points raised during the Committee’s previous inquiry into DB pensions with Liability Driven Investments, which examined the events of autumn 2022. The Committee heard that a repeat of the events was now unlikely given the steps taken to improve resilience.

A full list of the Committee’s conclusions and recommendations is available on Pp 54–58 of the report.

Nearly half of Scottish parents are struggling to maintain a work-life balance during cost of living crisis

  • The Balancing Act: Nearly half of Scottish parents (42%) admit their job prevents them maintaining a healthy work-life balance when it comes to their children, with 78% further admitting they feel trapped in their current career due to external factors
  • The Need for Change: Self-employment ranked as most attractive (27%) amongst Scottish parents looking for a new career to allow them a better work-parenting balance
  • New Career Aspirations: AA Driving School research reveals under pressure parents seek working-life changes

New research from AA Driving School shows that nearly half (42% and 51% across the UK) of Scottish parents find their job prevents them from finding a healthy work-life balance, due to childcare and cost of living pressures.

Increases to the cost of childcare have driven Scottish parents to work either additional hours in their current job (19%) or even take another job (12%) to financially support their family.

The Balancing Act

Data found that 22% of Glaswegians experience parent guilt every day (compared to 18% nationally), the top cause being the need to work additional hours which in Scotland was 50% to support their family financially.

More than half (52%) of UK parents agree that childcare costs influence their career decisions, with the age-old dilemma of ‘having it all’ truly impacting parents as nearly 3 in 5 (59%) feel guilty for working long hours instead of spending time with their children.

Nearly a quarter (24%) of Scottish parents admit they have missed their child’s sports day, parents evening (19%) and even their first steps (10%) due to work commitments.

The Need for Change

Against this backdrop, half of UK parents (49%) are ready to take the plunge and will look to explore a new career path this year to improve their work-life balance. With 60% of people in Edinburgh valuing flexible hours the most when seeking new career benefits, compared to the national average of 50%.

Among UK parents considering a change of employment, nearly third (34% and 27% across Scotland) would prefer self-employment if they were to change careers – ahead of retail (14%), healthcare (13%), education (19%) or other office work such as HR, IT and customer services (16%).

AA Driving School is encouraging Brits who are unhappy with their work-life balance to consider more flexible employment by becoming their own boss as an AA driving instructor.

Camilla Benitz, Managing Director at AA Driving School comments: “Inflexible 9-5 working models make it difficult for many parents to balance work and family life.

“Our research shows there is a greater need for workplace flexibility to assist UK parents balance financial, career and parenting needs. Many AA Driving School instructors have chosen this career to allow them flexibility around their families as well as having a long-term, rewarding career.”

Darren Churchill, an AA Driving School instructor since 2021 shares how being able to work flexibly and choose his  own hours has improved his work-life balance: “It was being put on furlough during the first lockdown that first got me thinking about a career change.

“I really valued the extra time I had with my children and I realised I didn’t want to give that up by going back to a 9 to 5 job. Having worked as a front of house manager for Ford previously, I was keen to stay within the motoring industry and becoming a driving instructor really appealed.

“It’s the best decision I’ve made as the flexibility it gives me with my children and family life is invaluable.”

For more information on how to become an AA Driving Instructor, please visit: Driving Instructor Training Courses | AA Driving School (theaa.com)

Amazon Announces New Term-Time Contracts

  • Amazon offers new term-time contracts, providing its operations employees in Dunfermline and across the UK guaranteed time off during Summer, Easter and Christmas holidays, enabling more time with their children
  • The innovative contract is part of a wider flexibility boost which also includes a part-time pick-your-shift option

Amazon has launched an innovative new contract that offers parents, grandparents and guardians of school-age children the choice to work term-time only.

The new contracts, available at the Dunfermline fulfilment centre, guarantee time off for the six-week Summer break, as well as the two-week Easter and Christmas holiday periods, without affecting the comprehensive range of benefits they receive, including private medical insurance and life assurance.

The contracts, aimed at better supporting family needs, were successfully trialed at three sites following employee feedback, and are now being phased in for employees in Dunfermline and across all Amazon’s fulfilment centres – the places where Amazon store, pick and pack items for sale. They will be rolled out to sort centres and delivery stations across the UK later this year.

Amazon also announced a new flexible part-time contract for a minimum of 80 hours a month which lets employees pick and mix the shifts which suit their needs; part-day or full-day, day or night, weekday or weekend. The contract will support people who are unable to find work due to family or other commitments that require flexibility, return to the workplace.

As with all roles at Amazon, a current employee could refer a friend or family member to this option, which could also provide similar, required flexibility to a partner at home. The part-time contract, piloted at five fulfilment centres and now being expanded to a further seven sites, was also introduced as a result of employee feedback.

Jamie Strain, General Manager at Amazon in Dunfermline, said: “We’ve listened to our employees’ views on flexible working and I’m really proud that we’ve introduced new and innovative options based on their feedback.

“Both of these contracts put a really important emphasis on work-life balance and I’m certain they’re going to make a positive difference for many of our people.”

John Boumphrey, Amazon’s UK Country Manager, said: “At Amazon, we’re always innovating for our employees and our customers. I’m delighted to announce these new flexible working initiatives that provide even more choice for current and future employees, enabling them to better manage their home and work commitments.

“Amazon already provides a four-day working week for our fulfilment centre employees in the UK, and term-time contracts are another great example of how we are using feedback from our people to support them with their childcare needs, giving families more time together.”

He added: “Providing a flexible part-time contract where people can pick the shifts that best suit their needs will support our employees’ partners and other job-seekers with family caring commitments a route back to the workplace, helping to boost household income.”

Amazon already offers multiple types of contract. A standard working week is 40 hours, with shift-swaps and part-time options.

Term-time contracts are now available to thousands of Amazon’s fulfilment centre employees. The part-time pick-your-shift option has been rolled out to seven fulfilment centres following a successful trial, with more sites soon to follow.

GRoW (Get Ready for Work) supports women back into the workplace. Director Liz Sewell is particularly interested in term-time contracts: “Term-time working has the potential to give a lot of people the support they need, so it’s an interesting and progressive change at Amazon.

“We know that many women want to work flexible hours and for those with younger children term-time working makes so much sense. We believe it’s a great way to support a widening of the workforce as well as providing valuable flexibility for parents.”

Schools: Something’s got to give (1)

Holyrood and Scotland’s councils on collision course

Measures to ensure that teacher and pupil support staff numbers as well as school hours are protected have been announced by Education Secretary Shirley-Anne Somerville.

The Scottish Government has committed to increasing teacher numbers by 3,500 during this Parliament.

Since 2017/18 local authorities have received funding to protect the pupil-teacher ratio, teacher numbers and to provide places  for all probationers who need one.

Additional annual funding of £145.5 million is also being provided to maintain increased teacher numbers and support staff. In the year ahead (2023/24), if this is not delivered by a local authority, the Scottish Government will withhold or recoup funding allocated for these purposes.

Regulations will also be introduced under legislation passed by the Scottish Parliament in 2016 to enshrine a statutory minimum number of school hours.

Ms Somerville said: “The measures I have outlined today demonstrate our unyielding commitment to closing the attainment gap and making Scotland the best place in the world to grow up. 

“We are committed to recruiting more teachers and support staff, and we have already provided significant additional funding to Local Authorities to help ensure this happens.

“The Scottish Government recognises the challenging budgetary decisions facing councils and that is why the Deputy First Minister has committed to delivering a new deal for local government. However, this Government has a clear commitment to improving education – and maintaining both teacher and support staff numbers and learning hours is crucial to that.

“I recognise the importance of strong partnership working between local government, central government and Education Scotland to achieve our ambitions. 

“I will be writing to COSLA today, and each individual council in the coming days, to set out the details on protecting teacher and support staff numbers, and next steps on learning hours.”

COSLA HIGHLIGHTS MASSIVE CONTRADICTION IN RELATION TO EDUCATION AND COUNCIL FUNDING

COSLA yesterday (Tuesday) highlighted to the Scottish Government a massive contradiction in relation to Scottish Education and council funding. This followed an emergency meeting of Council Leaders on Friday and ahead of Ms Somerville’s Parliamentary statement.

At Friday’s meeting Council Leaders reacted with great disappointment to the Scottish Government’s cutting of Local Government’s funding on the one hand whilst at the same time legislating/intervening to prevent headlines showing the unpalatable consequences of those cuts.

Councils are unanimous that attainment is not just about teacher numbers, especially in areas where school rolls are declining, and depends also on a wide range of other council services and support staff.

Accordingly, councils must be left with the flexibility to manage their inadequate budgets to minimise the impact on attainment and the other services the public depend upon. To do more than this will require the Scottish Government to provide additional funding, not more restriction.

Council leaders were clear that Local Government wants to protect education. Councils want to continue to improve the attainment and achievement of children and young people, whilst also retaining the teachers and support staff that are required to do this.  It’s the Budget which is putting these things at risk, not Local Government.

COSLA said that the reality is that Scottish Government Budgets over a decade have left us with a funding crisis in Local Government the likes of which have never been seen before.

Commenting yesterday in a joint statement, COSLA’s Presidential Team said: “The timing and approach of the Scottish Government’s latest move undermines the democratic mandate of Local Government and is a U-turn on previously agreed flexibilities for councils over their budgets.

“It is not the case that Local Government wants to cut any of our services; we have to work with the budgets we have and unless there is more funding, we are forced to make democratic decisions on priorities for the communities we serve.

“On the one hand our budgets have been cut in real terms, and on the other hand the Scottish Government is intervening with additional policies which means significant cuts will have to be made in other areas that support children, young people, families and our communities.

“We have been clear about the limited options facing Local Government because of the Scottish Government’s Budget for 2023/24, a view which is shared by the independent body Accounts Commission.

“We have also highlighted the impact of the initial proposed interventions on other Local Government services, including those which directly support the attainment, health and wellbeing of children and young people.

“These latest asks and the Government’s narrative demonstrates a Government who does not fully value and respect Local Government’s role. Asks of this nature are addressing a symptom, not the cause.”

Further talks on fiscal reform

Clarity needed on Barnett consequentials

During yesterday’s session of the Joint Executive Committee (JEC) with the Chief Secretary to the Treasury Simon Clarke, Finance Secretary Kate Forbes outlined some of the challenges needing to be addressed as part of the forthcoming joint review of the Scottish Fiscal Framework.

Chairing the meeting in London, Ms Forbes highlighted the need for further collaboration on fiscal flexibility, including consideration of further financial powers as part of the forthcoming Fiscal Framework review.

The meeting follows the UK Government’s Council Tax Energy Rebate announcement and the consequential funding for the Scottish Government.

The Spring Budget Revision has also been published showing that the Scottish Government has spent almost £15 billion on measures to respond to COVID-19 since the beginning of the pandemic. It represents the final decisions made in the Scottish Government budget allocations for this financial year despite the challenges due to late notification of consequentials.  

 

Speaking following the JEC, Ms Forbes said: “I have had a constructive conversation with the Chief Secretary to the Treasury this afternoon, where there was a frank exchange of views on what is quickly required from the Fiscal Framework Review and the need for further fiscal flexibility for Scotland.

“Our experiences of dealing with both the health and economic impacts of the pandemic and supporting those struggling with the cost of living crisis clearly demonstrate how difficult it is to take actions we deem vital without sufficient fiscal powers and often with late notice or lack of engagement when further funding is coming.

“This has been proven once again today. Whilst I will always welcome funding, the net change to our budget isn’t clear yet  – we are awaiting urgent clarity on this from the Treasury and how it will impact our final settlement for the current year.

“As the First Minister has said, we will pass on the full consequential funding to support people struggling with the current costs of living. Council Tax is already lower in Scotland and our current support such as the single Council Tax Reduction Scheme protects 470,000 lower income households.”

And the UK Government’s take on yesterday’s meeting:

Chief Secretary to the Treasury Simon Clarke held talks with the Scottish Government’s Cabinet Secretary for Finance and the Economy Kate Forbes yesterday to discuss the upcoming review of the Scottish Government’s Fiscal Framework.

The ministers agreed they were close to finalising arrangements for an independent report on the Scottish Government’s Block Grant Adjustment arrangements which will inform the review.

They shared the ambition to get this first stage launched as soon as possible.

The Chief Secretary and Cabinet Secretary also agreed that the Fiscal Framework review should be guided by principles set out in the Smith Commission agreement. They discussed the importance of several principles, including fairness and consistency, as well as the need to have a framework that is implementable, sustainable and operates effectively in practice.

Both ministers expressed a desire to avoid unnecessary delays to starting the Fiscal Framework review, and agreed to continue a dialogue and joint preparations for the review while the independent report is underway.

Ministers also discussed financial impacts relating to the income tax personal allowance.

Chief Secretary to the Treasury Simon Clarke said: “Today was an enjoyable and productive meeting. We are working closely with the Scottish Government and engaging in regular discussions on the Fiscal Framework review, making good progress on our approach to the Scottish Government’s future finances.”