Pensions Bill risks being a missed opportunity
16 May 2016
Steve Webb, Director of Policy at Royal London, has warned that the widely expected Pensions Bill risks being a ‘missed opportunity’ if it is too narrowly focussed. The Department for Work and Pensions has indicated that Wednesday’s Queen’s Speech will include a Pensions Bill to tackle concerns about the inadequate regulation of small Master Trusts used for automatic enrolment. But there is a wide range of pensions issues where matters could be improved by new legislation.
- Action to ensure that the 10 million people being automatically enrolled into workplace pensions save more than the legal minimum of 8% of qualifying earnings;
- New rules to force pension schemes and pension providers to supply data to a ‘pensions dashboard’, so that savers can see all of their pensions in one place;
- Measures to tackle the pensions savings crisis among Britain’s 4.6 million self-employed people who are currently excluded from automatic enrolment.
Commenting ahead of the Queen’s Speech, Director of Policy at Royal London, Steve Webb said:
“Automatic enrolment has got off to a great start, with six million more people now saving into a workplace pension. But a number of legislative changes are now needed to build on that success. For most savers, the legal minimum of saving 8% of salary by 2019 will not be nearly enough for a comfortable retirement. Legislation is needed now to make sure that people put a little more into their pension each time they get a pay rise. Measures are also needed to tackle the pensions crisis among the self-employed, who have been excluded from automatic enrolment.
“Automatic enrolment also means more people with more fragmented pension pots and a pensions ‘dashboard’ will help them to see all their pensions in one place. But this will only happen if pension schemes are required by law to provide all the necessary information to the dashboard service.
“Whilst the Government’s plans to legislate to protect savers in small Master Trust arrangements are welcome, this Bill could be a missed opportunity if it does not address some of the more fundamental issues of inadequate pension saving.”
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About Royal London:
Royal London is the largest mutual life, pensions and investment company in the UK, with Group funds under management of £87.9 billion. Group businesses provide around 9.1 million policies and employ 3,051 people. (Figures quoted are as at 31 March 2016).