UK - Minister for Pensions, Stephen Timms (pictured), has hinted that the government will support automatic enrolment or soft compulsion - one of the recommendations that reportedly forms part of the Pensions Commission's soon to be published report on UK pension reform.
“Our own case study research has shown auto-enrolment to be effective for increasing pension scheme membership, reducing administrative burdens for employers and pension providers and also making the whole process simpler for employees,” he said.
His comments, made at the National Association of Pension Funds (NAPF) autumn conference, came on the back of a Financial Times report which today claimed raising the retirement age to 67; introducing a new national pension savings plan into which individuals will be automatically enrolled, with the right to opt out; and a more generous state pension over time were the key reform options presented in the report.
The report by Adair Turner, who heads up the Commission, is due for publication at the end of the month.
According to the FT, the report will say the state pension should in time pay out closer to the £109 a week that is now the means-tested minimum income guarantee, rather than the £80 a week for the basic state pension. It should also rise in line with earnings, not just prices.
The report allegedly recommends a new “Britsaver”, a national pension savings plan based on New Zealand’s planned Kiwisaver, with contributions to personal accounts collected through the pay-as-you-earn system and individuals offered an initially limited choice of funds into which the money will be invested.
A spokesperson for the Pensions Commission refused to comment on the merit of the newspaper report, saying: “It’s speculation and we don’t make comments on speculation. The things that are quoted are from our first report.”
According to new research from Fidelity, the introduction of auto-enrolment to employer-backed pensions could increase take-up to as much as 90% of employees.
On the claim that the Commission will recommend raising the retirement age from 65 to 67, shadow work and pensions secretary, Malcolm Rifkind, said: “The prime mininister is creating huge inconsistency and inequality in the pensions system, having just done a deal with the trade unions to let existing public sector workers retire at 60.”
Speaking at the conference, Timms also flagged up plans to reduce the regulatory burden for employer-sponsored pension schemes.
“We are determined to remove unnecessary regulation and simplify regulatory burdens wherever we can,” he said. “Over the next three or four years, we will deliver year on year reductionis in administrative burdens. A rolling plan of simplification will focus on removing or merging regulation into a more manageable form; resolving overlap and inconsistency; and wider deregulatory measures too.”
The Pensions Regulator (TPR) and Labour MP Stephen Kinnock and will listen to the experiences of steelworkers when transferring their pensions away from the British Steel Pension Scheme (BSPS) next week in Port Talbot.
Just Group has acquired a 75% stake in the holding company of Corinthian Pension Consulting in a bid to strengthen its professional defined benefit (DB) advisory services.
The Pensions Regulator (TPR) has exercised its production order power under the Proceeds of Crime Act 2002 for the very first time as part of a fraud investigation.
The ITN Limited Pension Scheme has named Trafalgar House as its administrator for an initial term of five years.