A roadmap for pensions reform
The government has published a roadmap for workplace pensions – setting out the overarching aims for reform as well as the sequencing and timing of the implementation of the legislative package.
The roadmap accompanies the Pension Schemes Bill, which will be laid before parliament today, aims to give pension schemes and providers with a sense of the direction over the coming five years allowing the ecosystem as a whole to understand the government's sequencing and plan for the future.
Read Workplace pensions: a roadmap in full here
Minister for pensions Torsten Bell said: "A shared understanding of the destination is crucial to industry, individuals and government taking the right decisions to all pull in the same direction. That is why we owe it to everyone to spell out how the myriad changes now underway fit together.
"This is what this roadmap aims to provide. In so doing it spells out the phasing of reforms we are engaged in. Some will be impatient for swifter progress, others concerned by how many things are to be done in quick succession. In thinking about this timeline, I have balanced the need for change with the reality that all institutions face capacity constraints in implementing change. And yes, that includes government."
Bell outlined the reforms the government was currently undertaking – with the Pension Schemes Bill legislating to implement the outcome of the Pensions Investment Review as well as putting in place wider changes, such as addressing the small pots problem, putting in place a value for money regime and giving trustees of defined benefit schemes greater flexibility to access surplus funds of their scheme.
The minister added: "My priority is to have these changes underway. I am then looking forward to launching the second phase of the Pensions Review shortly.
"This will focus on the adequacy of retirement incomes and the fairness of the system that has persistent inequalities within it. It is 20 years since the Turner Commission, and it is time to build on that legacy by completing the job."
He continued: "I am alive to the challenges of doing so, but we should take confidence from the policy challenges we have overcome before; the challenges of the 1990s, where the threat of employer insolvencies risked leaving employees with empty promises, and of the 2000s, where millions were saving nothing for their retirement at all."
He said: "Governments are like people in one important way: they can easily put off thinking about pensions until it is too late. We must not do that, and we are not doing that. I know the task is to finish the job – to celebrate that people are saving something, but recognise our job must go beyond that: to build a pension system. This roadmap helps chart the course."
Defined Benefit Roadmap
Source: Department for Work and Pensions - Workplace pensions: a roadmap
Defined Contribution Roadmap
Source: Department for Work and Pensions - Workplace pensions: a roadmap
