When Queen Elizabeth II ascended the throne in 1952, employee benefits were pretty thin on the ground for the vast majority of her subjects. But the intervening 60 years have brought in a raft of perks and major changes in the workplace. Our cover story shows how government policy has, over time, shaped the benefits on offer in Britain today. Tax breaks, social security and fear of a pensions crisis (some things never change) all played their part.
When looking at pensions in particular, history shows that everything that has been introduced was done for a reason, even if the solutions led to further problems. Unfortunately, too often we see human behaviour come into play with pensions, and the actual outcomes have not always gone quite to plan. Let us hope that the next great pensions change on the horizon dodges much of this ‘people’ effect (see Pensions auto-enrolment roundtable discussion).
What is also fascinating to see is the data on exactly how the country’s workforce demographic has changed over those 60 years. As you would expect, the gender profile is unrecognisable, but it is also the shift from manufacturing and mining jobs to office-based managerial, professional and sales that makes today’s workers so different from those of 1952.
The current recession will further shape reward and pensions decisions, among both employers and staff. Employees need all the help they can get to understand the importance of saving enough so they can give up work when they want to (see our Workplace Savings Quarterly).
Employers are also aware of the importance of offering the best investment fund choices in plans such as group personal pensions, balancing getting a fair deal on annual management charges against paying for better investments. But this is a big ask with share prices so volatile.
Employers are also very cost-focused when it comes to healthcare benefits, according to our annual healthcare research (see Employee Benefits/Cigna UK HB healthcare research 2012). Nine out of 10 employers now look at cost when deciding to buy or to continue to offer healthcare benefits, but just 56% offer them to reduce sickness absence.
Benefits may play a bigger role in British workplaces than they did back in 1952, but they can also be a much bigger cost headache for employers.
Debi O’Donovan, Editor
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