❑ MARK HYDE & JOHN DIXON University of Plymouth ‘Working and saving for retirement’: New Labour’s reform of company pensions Abstract In a number of recent policy statements, the Labour government has developed a series of reforms for employer-sponsored company pension schemes, an integral element of the contracting out arrangement of compulsory second-tier pensions. At best, the reforms are ambivalent. While they address a number of important issues, they are likely to reinforce income insecurity. Above all, we identify a range of issues that must be integral to the reform of company pensions, but that have been ignored by the government – compulsory employer contributions, universality and the role of employees in sponsoring and administering pension schemes. Key words: choice, employers, security, simplicity, trust Introduction Company pension schemes have been enormously popular among employees because they have been based on the defined benefit principle 1 which requires future retirement benefits to be specified as a proportion of final salary. This means that future retirees know their future retirement income potential well in advance. However, this type of non-state pension arrangement is in decline. In recent years, such schemes have been closed to new members or wound up, and pension benefits have been reduced. This has resulted from a number of pressures, including investment revenue shortfalls, active under- funding and the forced disclosure of pension fund deficits under the controversial FRS17 accounting standard. These developments have been accompanied by human interest stories focusing on the resultant negative prospects facing scheme members during retirement. At risk Copyright © 2004 Critical Social Policy Ltd 0261–0183 79 Vol. 24(2): 270–282; 041953 SAGE PUBLICATIONS (London, Thousand Oaks, CA and New Delhi), 10.1177/0261018304041953 270