UK - More than a third of UK companies feel that the Pension Protection Fund (PPF) would have a negative impact on their decision to provide defined benefit pension schemes in future, according to a new survey.
The EEF/Aon Consulting survey found that nearly 36% of companies felt that the introduction of the PPF would have negative impact on their decisions, while 49% said that it would have no impact at all.
Only 4% of the 50 companies polled said that the PPF would have a positive impact on their decision to provide a DB or hybrid scheme. Manufacturers said that government policy on the proposed PPF is currently poorly expressed and needs greater clarity if it is to have any chance of greater employer support.
The survey also found that although two-thirds of the companies supported, in principle, the idea of the PPF, there was still considerable confusion and uncertainty amongst employers about how the PPF will operate and the costs that they will incur.
Three quarters of them felt that employers should be able to recover all or part of the PPF levy from pension scheme members.
EEF deputy director of employment policy, David Yeandle said: Employers clearly need more information about the way in which the PPF will operate in order to make a proper assessment of its practical implications for their business and time is rapidly running out if this is to be done before the PPF's planned implementation in April 2005.”
Donald Duval, head of professional practice at Aon Consulting added: The government must not lose sight of this bigger issue - the savings shortfall. It is vital that it continues to promote a better understanding of saving for retirement and encourage greater pension provision now more than ever before.”
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