Letter: Pension schemes limit job mobility

Sir: The problem of split pensions highlighted in your article ('Shady history of company pensions', 1 April) has a further European dimension. Although pensions can now be transferred from one company scheme to another company scheme within the UK, it is not possible to transfer pension rights from a company in the UK to one in another country which is also a member of the European Union.

Thus it is possible, within a multinational organisation providing contributory final salary based pensions in countries in the EU, for an employee (1) to have 20 years' continuous service with that multinational, but with the service split between two countries; and (2) to pay 20 years of continuous pension contributions, but to receive pensions as if the employee had two terms of service of 10 years with separate companies.

To ensure that job mobility within Europe is achieved, pensions must be transferrable within Europe, and a wider choice of pension schemes must be developed so that itinerant workers are not disadvantaged.

Yours faithfully,

DAVID G. KEITH

Voorburg, The Netherlands

5 April