Pension reform is right, says insurance group

Thu, 23 Nov 2006

The Association of British Insurers is expressing support of the reform of the pensions system, calling on the government to do more to encourage pensions savings among UK workers.

A new report from the Association of British Insurers finds that millions of workers are not effectively saving for their retirement and many are unaware of government plans to reform the pensions regime.

Research carried out by Deloitte and published by the Association of British Insurers has also found that some 25 per cent of employees would possibly cut down their current pension payments once personal accounts come into effect.

This would mark a reduction in pensions provision for somewhere in the region of 2.4 million workers.

"There is still a long way to go both to encourage more saving and to get the details of personal accounts right," comments Association of British Insurers director of life and pensions Chris Kenny.

"Over 12 million people are still not saving enough for their retirement, and many don't believe that the government's plans to increase saving will ever be enacted. In this context, it's even more vital that the government takes action to ensure that existing private pension provision is allowed to prosper and grow."

The Association of Consulting Actuaries is recommending that the government focus on a risk sharing pension scheme in a bid to encourage better saving among UK employees.


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