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Pensions

Answer

The coalition agreement includes a commitment to:"““...simplify the rules and regulations relating to pensions to help reinvigorate occupational pensions, encouraging companies to offer high-quality pensions to all employees and we will work with business and the industry to support auto-enrolment.””"The key programme to reinvigorate private pension saving is the workplace pension reforms—automatic enrolment into a workplace pension, compulsory employer contributions and establishment of the National Employment Savings Trust (NEST). From October 2012 all employers will be required to automatically enrol their eligible workers into a qualifying pension scheme. We estimate that the reforms should lead to 5-8 million people newly saving or saving more for their retirement.To help ensure that existing pension law remains appropriate following automatic enrolment, we have issued a call for evidence on the different regulatory regimes in place for trust-based occupational pension schemes and contract-based schemes. This will look at, among other things, the likely increase in the number of small pension pots post-automatic enrolment and possible solutions for helping schemes better manage the challenges they present—including looking at the rules around transfers. The call for evidence closes on 18 April and we will bring forward any proposals for change in due course. We are also engaging with the Pensions Regulator which has issued a discussion document (for response by 22 April) on defined contribution pensions¹.A range of other measures has been put in place or is in train to support good pension provision. For example, simplified disclosure of information regulations enabling greater use of electronic communications came into force on 1 December 2010². The rules on employer debt to pension schemes are being reviewed to make it easier for companies to restructure while protecting members' pensions. The aim is to introduce these changes in October 2011, following public consultation.We are ending contracting out for defined contribution pension schemes³. This will simplify pension choices for individuals and administration for schemes.The Government are exploring how pension saving might be made more attractive to individuals. For example, we are removing the requirement to annuitise at age 75 as part of the Finance Bill 2011, and we are continuing to consider options for improving take-up of the open market option for annuities.We are also engaging in debates across the broader pensions community, and welcome initiatives such as the National Association of Pension Funds' Workplace Retirement Income Commission, which aims to develop consensus on how to improve and strengthen retirement savings4."¹ ““Enabling good member outcomes in work-based pension provision””.""http://www.thepensionsregulator.gov.uk/docs/dc-discussion-paper-2011.pdf""² SI 2659/2010 The Occupational, Personal and Stakeholder Pension Scheme (Disclosure of Information) (Amendment) Regulations 2010""³ Legislated for in the Pensions Acts 2007 (s15) and 2008 (s106)""4www.napf.co.uk/PressCentre/Press_releases/0095_West_Midlands_least_confident_about_paying_for_retirement.aspx""http://wricommission.org.uk/wric/"

Secondary information

Type

Written question

Reference

48532; 525 c1243-4W

Session

2010-12

Related items

Pensions Bill [HL]
Tuesday, 15 March 2011
Proceeding contributions
House of Lords

Subjects

Pensions

Link

View this Written question on www.publications.parliament.uk