UK - Occupational pension provision is "patchy" and the government should increase basic state benefits, a left-wing think-tank claims.
Catalyst says the basic state pension’s link with average earnings must be restored fully.
In its latest report – Better Pensions, The State’s Responsibility – the think-tank warned that occupational schemes were not widespread enough to solve the problems of pensions provision in the UK.
It said: “The coverage of occupational pension schemes is very patchy, being designed essentially for those with steady employment and earnings; and their results are generally modest.”
It said the government could only guarantee that people would not spend their retirement in poverty by boosting the basic state pension.Former PMI president Ian Eggleden endorsed the approach taken by Catalyst.
He said: “Putting the emphasis on the basic state pension would help people off means testing and help those running occupational schemes to plan with more certainty because they would know what the state would provide.”
Eggleden said the new pensions credit was “horrendously complex”.
The Pensions and Lifetime Savings Association (PLSA) has announced it will shrink its board by more than one-third as part of a governance overhaul to make it "agile and more appropriate".
Smaller FTSE 350 defined benefit (DB) schemes were nearly 15 percentage points less well-funded than larger schemes in 2017, according to a Goldman Sachs Asset Management (GSAM) analysis.
The advent of collective pension systems could help the UK avoid demographic challenges which will make it "impossible" for society to help savers in retirement, experts say.