Political parties have been lambasted for turning their back on the pension industry in the lead up to the UK General Election.
Disillusionment is growing and expectations for significant reform in the next Parliament are slim.
Several industry figures – including chairman of the Institute of Actuaries Pensions Board Peter Tompkins – said the future of company pension provision “has never looked bleaker”.
And in a wake-up call to senior politicians, the industry has spelt out its priorities for the next government. These include:
• Abolishing the MFR and implementing its replacement “very quickly”.• Liberalising the annuities market.• Grappling issues of compulsory employer contribution within stakeholder and possible harmonisation of pension legislation across the EU.
Much of the manifesto proposals from the main parties sidestep regulation within the occupational market. And the political silence is accelerating calls for a shake-up of the government's priorities.
William M Mercer European partner Matthew Demwell said the outgoing government has proposed changes but has failed to put any substance to its rhetoric.
“We can presume that the Labour Party are committed to the recommendations of the Myners review, but some inkling of what ‘proper regulation’ might be imposed would have been helpful.”
Demwell added: “The Conservatives have not mentioned occupational schemes – their idea that people could contract out of the BSP seems an unnecessary complication [and] in the longer term could prove a further disincentive to providing defined benefit pension provision.”
The Association of Consulting Actuaries said it was disappointed at the lack of attention given to the state of pension provision “beyond the basics”.
It said: “Perhaps all 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.”
Hammond Suddards Edge pension lawyer Ian Forrest agreed and said: “DB schemes have been seriously undermined in the last four years due in no small measure to the abolition of ACT, the cost burdensome compliance requirements, the MFR and falling annuity rates. None of the three main parties has properly addressed these issues.”
The Pensions and Lifetime Savings Association (PLSA) is in the process of convening an industry-wide group to take forward the work of the Institutional Disclosure Working Group (IDWG).
The Transfers and Re-registration Industry Group (TRIG) has given its support to an initiative which aims to complete occupational pension transfers within three weeks.
Scottish Widows has completed a bulk annuity deal for the Hitachi UK Limited Pension Scheme.