Directors are continuing to award themselves generous salary-linked pensions while closing similar schemes for new employees, according to research from the TUC.

In an analysis of 121 of the largest companies in Britain, the union body discovered that 58 per cent were offering defined benefit pensions to new directors but not to new employees.

Forum Response: Institute of Directors

Derek Brownlee, pensions executive at the Institute of Directors, told ePolitix.com: "The TUC is wrong to assume that defined contribution pensions are 'inferior' to defined benefit schemes - what matters is the pension provided at the end of the day.

"Our own forthcoming survey on pensions, which covered four times as many companies as the TUC's report (including the small and medium sized companies which employ huge numbers of people, but which the TUC has conveniently ignored), shows a different picture with only one-third of companies offering a different type of pension for senior staff.

"In fact, the real gulf in pensions is not between directors and employees, but between private and public sector workers - public sector workers being much more likely to receive a final salary pension, and to be able to retire early - than the private sector workers who pay through the nose in tax to fund them.

"If the TUC really wants to end 'feather bedding' and 'hypocrisy' in pensions it could start by embracing a fairly modest reform of public sector pensions it has so far opposed: aligning the retirement age in the public sector with the rest of the workforce."