UK - Mercer Human Resource Consulting is urging the Government to slash the "intolerable" red tape surrounding public and private pension provision and introduce a single tax regime.
Mercer said that it welcomed recent Government initiatives to combat the problems, but stressed that “the current position can’t continue”.
Deborah Cooper, senior consultant at Mercer said: “In the past, employers and the pensions industry have taken on an intolerable burden of red tape, with layer upon layer of regulation built up by successive governments.
We now have to cope with nine different tax regimes, and in final salary schemes there can be several different sets of calculations to do for each member’s benefits.
The Government is set to consult on three separate simplification reviews, including regulatory regimes for private pensions led by EFRP chairman Alan Pickering; the taxation of occupational pensions led by the Inland Revenue, and a review of retail savings headed by Ron Sandler, former chief executive of Lloyds and chief operating officer of Natwest Group.
The government should grasp the nettle and opt for a single tax regime that applies to everyone - even if some will gain or lose more than others,” added Cooper.
Mercer claims that the rewards of adopting a single tax regime would include savings in employers’ administration costs; a slow-down in final salary schemes closures, and a more comprehensible system.
By Madhu Kalia
A number of pension schemes have been prompted to lock in gains with a move into bonds after the estimated deficit across FTSE 100 DB pension schemes improved by £36bn, over the 12 months ending 30 June last year, JLT Employment Benefits found.
HM Treasury has agreed in principle to give NEST a £329m contingent liability guarantee in the event of the master trust's wind up or closure.
AMP Capital has set up a dedicated team to help institutional investors, including pension funds, invest in infrastructure through direct equity allocations.