BRITISH workers are used to fretting about when - and if - they can afford to retire.

Today, however, the country's pensions crisis took a sinister new turn.

Nestle Rowntree was rumoured to be contemplating closing its York factory and relocating production abroad. Why? Because of the amount it was being asked to pay into the pension Protection Fund (PPF).

Nestle quickly denied the claim. But the problem this story exposed will not go away.

The PPF was set up to provide a safety net for occupational pension schemes. Each business will pay a levy which goes up if they are calculated to be at risk of going bust. It is hard to think of a measure more likely to push struggling firms to the wall.

Moreover, the formula which works out a company's failure rating takes no account of international ownership. So Nestle is reportedly expected to pay £12 million on behalf of its York division, rather than the £300,000 it expected. This is economic madness.

It is bad enough that Gordon Brown raided pension funds, prompting the closure of so many occupational schemes.

It is bad enough that the Government expects private employees to work until they are 67 to pay for the pensions of public sector staff who retire at 60.

It is bad enough that a two-year Government report on pension reform was attacked by ministers before it was even published.

But it is utterly intolerable that the pensions crisis might rob workers of their jobs. If the Chancellor does not sort this out, he should be the one forced into early retirement.

Updated: 09:10 Monday, November 28, 2005