Final pension salary could be slashed by one third under governments proposed plans.
Millions face having their retirement income cut by up to a third under Government plans to shake up final salary pensions.
MPs are considering rule changes to help firms facing a £1trillion funding black hole.
Currently, final salary pensions must increase in line with inflation.
Incomes earned since 1997 track the Consumer Price Index inflation figure, capped at 2.5%.
But people living longer, historically low interest rates , volatile stock markets and quantitative easing have all dented pension funds and left huge deficits.
Plans by the Work and Pensions Committee include letting firms cut the amount they uprate pension income s by each year. Employers could then increase incomes by a smaller amount – or give no increase.
Pension incomes would cease to keep up with the cost of living, shrinking the amount over a retirement of 20-odd years. Experts predict they could lose a quarter to a third of what they expected.
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