BLOG: The pension that stole Christmas

Written by Natalie Tuck

I have to admit that the headline to this blog is a tad hyperbolic. A pension has not literally stolen Christmas, but according to a former Cadbury employee, a pension has stolen a traditional bit of festive cheer.

Writing in the Independent over the weekend, Chris Key, who worked for 15 months in the audit department at Cadbury’s, gave an expose on what happened after the takeover of the British chocolatier by Kraft back in 2010.

He wrote of how Kraft fell back on their promise not to close the Somerdale factory, making many redundant and now its new owner Mondelez International, which acquired Kraft in 2012, has announced it is dropping its commitment to Fairtrade.

Key also noted that, in the past, when it came to employees, Cadbury always looked after its staff and alumni. One part of this was giving out thousands of long-term former employees a gift of chocolate every Christmas.

Mondelez International, however, scrapped, this “inexpensive goodwill gesture” in an attempt to “help plug a gap in its pension pot”. And that is how the word pension can replace the word Grinch in an opinion piece. Except it wasn’t the pension that stole the festive chocolate treat, what we really have here is a case of the ‘Scrooge-like’ employer.

It is ironic really, when the most paternalistic product of all companies in the past was its final salary pension scheme, which is now being used as an excuse to cut back on other corporate paternalist practices.

The poor pension is a ‘scapegoat’ and like the Grinch is perhaps misunderstood and disliked by many. Mondelez using the pension as an excuse to stop sending out chocolate to its staff at Christmas is not going to help the situation.

We may not live in an age where heads of companies, such as the Cadbury family, see themselves as the paternalist employer, but it is poor form to blame these cuts on the pension scheme. And so as the holiday season approaches, it is a reminder to all, that the dear old pension is not a Grinch that stole Christmas.

Related Articles

Cautious optimism in a challenging world
Matthew J. Bullock, Investment Director, Global Multi-Asset Strategies, Wellington Management, meets Francesca Fabrizi to discuss how multi-asset strategies can help investors

Latest News Headlines
Most read stories...
World Markets (15 minute+ time delay)