On the money
When the chancellor first floated the idea that there should be a ceiling of £1.5m on the maximum permissible size of an individual’s pension pot, some of the most vigorous opposition came from the partners in City law firms
The reason for the upset was that they were expected to be ready to retire by
the age of 50, and a £1.5m pot would be too small to keep them for such a long
retirement period. Opposition was spread right across all the big firms.
Another source said that in his firm there were very few partners over 50 and
absolutely no one over 55. A third said that when partners turned 50 in their
firm they had to make a formal presentation to the other partners explaining why
they should be allowed to stay on.
Politeness prompts me to say that the biggest accountancy firms may be a bit
less brutal than the lawyers’ magic circle firms – but probably not all that
much. There are partners in their 50s and a few who make it to 60 but the ranks
are pretty thin. The systematic culls of underperformance to make space for the
young and hungry get them all in the end.
It is up to the firms to run themselves the way they think fit, but it seems
a far cry from the debate fuelled by Lord Browne’s reluctance to stand down as
chief executive of BP at 60 on the grounds that he did not feel tired and still
had a lot to offer.
Such tactics (or policies) will surely run foul of the legislation against
age discrimination which is due to come in to force this autumn and which will
make it illegal to make anyone retire against their will before they reach 65.
It is too much to expect all the professional firms to become a vast grey
area over night. It might well be however that they have to find ways to retain
and utilise their more senior citizens even when their best fee earning days are
behind them.
Anthony Hilton is finance editor of the Evening Standard