Bank offsets bonus tax with raid on staff pensions
Discussion
Barclays raids pensions to offset bonuses tax
Frankly who can blame them.
Daily Telegraph Philip Aldrick said:
A raid by Barclays on the pension benefits of 17,000 branch and other frontline staff has been used to offset the bonus tax for its high-earning investment bankers.
Details buried in the annual accounts show that the bank made a £371m profit last year from closing its UK final salary scheme to existing members. After a £150m "voluntary" top-up to help clear the deficit, the net profit from the move was £221m. The figure is almost exactly equivalent to the £225m bonus tax paid to cover the £2.2bn of awards to its 23,200 Barclays Capital staff.
The "one-off" profit is likely to infuriate branch workers, who balloted to strike over the removal of their benefits, especially as it matches the "one-off" bonus tax.
Barclays boss John Varley fought off the strike threat with a promise "to reinvest any one-off savings from the proposed changes into [reducing the deficit]". The £150m top-up is double the annual cash saving, as distinct from the £371m non-cash "curtailment gain", lifting total contributions last year to £525m.
Barclays plans to contribute just £290m next year, below the long-run average of £350m. "Potential additional voluntary contributions" may be made, the report states.
Pension top-ups are vital as the deficit has risen from £2.2bn to £4.8bn. Mr Varley, who received a £4.7m personal top-up last year, has said the existing arrangements are "untenable" due to rising costs.
A spokesman said: "The changes to the Barclays pension scheme were made before the end of 2009 and hence before any decisions were made regarding discretionary compensation or the [bonus] tax."
Regardless of the timing of any decisions and the coincidence that the amounts are similar in value, this surely will be perceived as a "where's my foot, take aim, fire!" moment for Barclays by the staff and others.Details buried in the annual accounts show that the bank made a £371m profit last year from closing its UK final salary scheme to existing members. After a £150m "voluntary" top-up to help clear the deficit, the net profit from the move was £221m. The figure is almost exactly equivalent to the £225m bonus tax paid to cover the £2.2bn of awards to its 23,200 Barclays Capital staff.
The "one-off" profit is likely to infuriate branch workers, who balloted to strike over the removal of their benefits, especially as it matches the "one-off" bonus tax.
Barclays boss John Varley fought off the strike threat with a promise "to reinvest any one-off savings from the proposed changes into [reducing the deficit]". The £150m top-up is double the annual cash saving, as distinct from the £371m non-cash "curtailment gain", lifting total contributions last year to £525m.
Barclays plans to contribute just £290m next year, below the long-run average of £350m. "Potential additional voluntary contributions" may be made, the report states.
Pension top-ups are vital as the deficit has risen from £2.2bn to £4.8bn. Mr Varley, who received a £4.7m personal top-up last year, has said the existing arrangements are "untenable" due to rising costs.
A spokesman said: "The changes to the Barclays pension scheme were made before the end of 2009 and hence before any decisions were made regarding discretionary compensation or the [bonus] tax."
Frankly who can blame them.
F i F said:
Barclays raids pensions to offset bonuses tax
Frankly who can blame them.
Frankly, who gives a sDaily Telegraph Philip Aldrick said:
A raid by Barclays on the pension benefits of 17,000 branch and other frontline staff has been used to offset the bonus tax for its high-earning investment bankers.
Details buried in the annual accounts show that the bank made a £371m profit last year from closing its UK final salary scheme to existing members. After a £150m "voluntary" top-up to help clear the deficit, the net profit from the move was £221m. The figure is almost exactly equivalent to the £225m bonus tax paid to cover the £2.2bn of awards to its 23,200 Barclays Capital staff.
The "one-off" profit is likely to infuriate branch workers, who balloted to strike over the removal of their benefits, especially as it matches the "one-off" bonus tax.
Barclays boss John Varley fought off the strike threat with a promise "to reinvest any one-off savings from the proposed changes into [reducing the deficit]". The £150m top-up is double the annual cash saving, as distinct from the £371m non-cash "curtailment gain", lifting total contributions last year to £525m.
Barclays plans to contribute just £290m next year, below the long-run average of £350m. "Potential additional voluntary contributions" may be made, the report states.
Pension top-ups are vital as the deficit has risen from £2.2bn to £4.8bn. Mr Varley, who received a £4.7m personal top-up last year, has said the existing arrangements are "untenable" due to rising costs.
A spokesman said: "The changes to the Barclays pension scheme were made before the end of 2009 and hence before any decisions were made regarding discretionary compensation or the [bonus] tax."
Regardless of the timing of any decisions and the coincidence that the amounts are similar in value, this surely will be perceived as a "where's my foot, take aim, fire!" moment for Barclays by the staff and others.Details buried in the annual accounts show that the bank made a £371m profit last year from closing its UK final salary scheme to existing members. After a £150m "voluntary" top-up to help clear the deficit, the net profit from the move was £221m. The figure is almost exactly equivalent to the £225m bonus tax paid to cover the £2.2bn of awards to its 23,200 Barclays Capital staff.
The "one-off" profit is likely to infuriate branch workers, who balloted to strike over the removal of their benefits, especially as it matches the "one-off" bonus tax.
Barclays boss John Varley fought off the strike threat with a promise "to reinvest any one-off savings from the proposed changes into [reducing the deficit]". The £150m top-up is double the annual cash saving, as distinct from the £371m non-cash "curtailment gain", lifting total contributions last year to £525m.
Barclays plans to contribute just £290m next year, below the long-run average of £350m. "Potential additional voluntary contributions" may be made, the report states.
Pension top-ups are vital as the deficit has risen from £2.2bn to £4.8bn. Mr Varley, who received a £4.7m personal top-up last year, has said the existing arrangements are "untenable" due to rising costs.
A spokesman said: "The changes to the Barclays pension scheme were made before the end of 2009 and hence before any decisions were made regarding discretionary compensation or the [bonus] tax."
Frankly who can blame them.
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