UK- Companies have saved themselves more than £4bn by closing generous final salary schemes according to the Trades Union Congress, the body responsible for over 7 million UK workers.

Since 1995 the number of people in final salary schemes has fallen by two million, a figure set to grow given the recent spate of closures.

According to estimates by the National Association of Pensions Funds, long-term contributions to money purchase (DC) schemes are 9% less than those paid into final salary schemes.

Speaking at the TUC’s ‘Prospects for Pensions’ conference in London, deputy general secretary Brendan Barber stressed that this is in addition to the £19bn taken in contribution holidays during the 1990s due to hefty returns on equities.

He said: "this money is being taken out of workers' pay packets, and will mean a much poorer retirement for many.”

He added: “now that markets are falling and employers are having to contribute again we find that too many are not willing to live up to their part of the pension promise. Time and time again employers are using the switch from final salary as an opportunity to cut contributions.”

Earlier this month general secretary of the TUC John Monks suggested that employers be compelled to make contributions to occupational schemes, a proposal dismissed by the Confederation of British Industry as “a tax on business.”