UK - Delaying action on Alan Pickering's Simplification Review proposals could mean that any changes will be too late for many schemes, actuaries warn.
The Association of Consulting Actuaries is concerned over rumours which suggest that “slips in the timetable” mean changes may not come into effect until 2004 or 2005.
ACA chairman Mike Arnold claimed that this would “simply be too late for many schemes and their members”.
Arnold said the association was hopeful for “robust” proposals from both the Pickering and Inland Revenue reviews.
But he warned there was “a real danger that the government was becoming complacent as employer after employer reviews their occupational pensions package”.
Arnold – speaking at the ACA’s annual dinner – said: “We have collected evidence from our members – who advise the vast majority of larger pensions schemes and thousands of smaller ones – showing that fewer than four out of 10 final salary schemes are now open to new members.”
And he added: “Close to half of those that are open are currently reviewing the situation.”
Government statistics show an increasing number of people working for employers who offer no occupational pension scheme. Arnold said a major concern for the ACA was that the government failed to see the significance of this trend.
“By and large our members are reporting that new or replacement pension arrangements are generally seeing much lower contributions than are, or were, going into final salary arrangements,” he added.
Arnold also said the introduction of stakeholder pensions had failed to encourage the appropriate level of savings among its intended target market.
He continued: “Coping with the fast-growing grey population, including not only their financial well-being, is going to be one of the biggest political and social challenges of the next few decades.”
* The ACA will be commissioning research this summer to help the government to see exactly what is happening across both larger and smaller employers.
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