The UK's Association of Consulting Actuaries (ACA) has slammed all three main political parties' pensions manifestos, expressing "disappointment" at how little is being said in the UK election about boosting pension provision.
According to the ACA, stakeholder and occupational pensions have also received little attention.
“Perhaps all of the political parties are finding it difficult to square up to just how much damage they've done to occupational provision over the last 20 years by meddling with benefit promises, over-regulation and tax raids”, said the association in a statement.
In a further examination of parties’ policies, the ACA concluded the following:
- Labour's policy to up rate the minimum income guarantee for pensioners by inflation throughout the next parliament - widening the gap between the basic state pension and the guaranteed minimum income - is likely to extend means testing and undermine private pension saving at lower income levels, especially given Labour's commitment to introduce a new ISA type 'Savings Gateway’ for people on lower incomes where their savings will be matched by the Government'.
- The Conservatives' policy to encourage some young people to opt out of the basic state pension in favour of funded provision seems strangely lacking in detail after four year's in opposition.
- The Liberal Democrats' policy of promising members a greater say over the use of their pension fund is likely to encourage further employer disillusionment with occupational arrangements.
On occupational provision, the ACA added: “Although grudgingly accepted, there is probably a 'private' realisation - certainly in Labour and Conservative camps - that present levels of regulation have damaged provision. The parties are less clear on how they can address this without turning their back on measures introduced in the 1995 Pensions Act to, in theory, safeguard members' interests.
“However, the first steps have been made with the government's announcement that the minimum funding requirement will be abolished and the defined benefit simplification project, announced recently. But will the speed of reform, or the final make up of that reform, be what is needed to underpin scheme provision? The jury is still out”.
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