Gordon Brown stole our pensions

I have long banged on about Gordon Brown's Treasury theft of money from every private sector pension by the elimination of tax credits for dividends received by pension funds. So it was with interest that I read today that:

"Britain's biggest pension schemes are almost £100bn short of the funds they need to meet their liabilities, according to a leading actuarial consultant. This would be the biggest such shortfall ever recorded.

Lane Clark & Peacock (LCP), which conducts annual audits of the health of the final-salary pension schemes of the UK's 100 largest public companies, said their collective deficit as at the middle of July was £96bn – more than double the £41bn reported in 2008. "

£96bn, that's a lot but how much of that is down to the markets and how much to our grasping ex-Chancellor? Alex Masterley has done the maths:

"At the time of the measure the cost was estimated at £5 billion per year, but clearly the figure will have grown with the economy as the relative value of business cash flows, and thus profits, will increase with inflation. For the purposes of this argument, let us ignore all the other factors such as that actually impacted corporate profits and assume look merely at a steady state 1997 economy would have produced in dividends if it had simply grown at a hypothetical constant inflation rate of 2.5%.

Then we need to take into account the loss of investment income from the cumulative shortfall over the last 12 years. I shall assume a reinvestment rate of 6%, which is somewhat on the low side. Lo and behold, we come up with a cumulative deficit, with inflation adjusted tax grabs and lost investment income factored in, of £95 billion.

So 99% (plus or minus 15%) of the deficit in your pension fund is down to the man who will walk away from his job next year with a guaranteed unfunded pension equal to 50% of his salary and to which he has contributed not one jot."

Now do you see why I, and others, hate Gordon Brown quite as much as we do? He may have fooled the "teenage scribblers" with his budget trickery and talk of "prudence" but some of us knew he was a fake and a fraud from day one, and we have been proved correct.