The History of Pensions

Our speaker on Thursday 13th June was our own member Trevor Blease, who gave a very detailed and informative talk about the development of pensions starting in the Victorian era through to the present day. 

Workers in the Victorian era had no pension provision as such and if they did not work they had no income. This resulted in much poverty in old age. There was no government responsibility to make a provision and the poor relied on self help, or payments into friendly societies, while the affluent took out old age insurance policies.  The Civil Service in 1859 developed a non-contributory pension providing a pension of 1/60 of final  salary for every year of service up to age 65. The Railway companies scheme was contributory and provided a pension of 67% of average salary after 45 years service. The year 1908 was the birth of the State Pension paid for from taxation. The payment at age 70 was 5 shillings per week. In 1925 the  pensionable age was 65 years and provided for by National Insurance contributions. In 1946 the weekly pension was increased to 10 shillings per week. Large companies provided private pensions as a means of retaining workers in their employ but leavers paid the penalty of loosing their pension contributions. Self help schemes were used by workers through purchase of endowment life assurance policies. In 1959 the State Earnings Related Pension Scheme [SERPS] was introduced. Up to the present time employee and employer National Insurance contributions have been gradually increased. The added benefit being that the pension value takes account of inflation levels.

President Arthur thanked Trevor for his very relevant talk.