UK plc disenchanted with pension policy-makers

The general election’s outcome will make no difference to UK pensions policy, according to the majority of employers responding to a survey by Punter Southall.

Nearly 9 out of 10 employers with workplace pensions expect a change of government at the forthcoming general election, a 57 per cent majority expect this to have little or no impact on pensions policy, and only 13 per cent think it would have a positive impact.

Punter Southall found that, while 36 per cent of respondents favoured the Conservative Party proposal for a lifetime savings vehicle, 41 per cent remained unconvinced. Respondents were also broadly hostile to the government’s proposed tax changes for higher earning pension savers, and a significant proportion are yet to be convinced of the advantages of new employer duties, to be introduced from 2012.

The survey identified a marked disenchantment with the efforts of policy makers. One respondent urged government to “stop mucking about with pensions legislation”, while another complained that “they cannot leave pensions alone”.

Damian Stancombe, head of corporate DC at Punter Southall, says: “Politicians on all sides have clearly failed to convince UK plc that they have adequately addressed the challenges facing our pension system. Our view is that these issues must be de-politicised. The focus must be on solutions and reaching consensus on the future, so that improvements can be made that will persist in the face of changing governments.

“The framework put in place must allow and encourage saving in a simple tax efficient environment, within durable limits. The move towards auto-enrolment has the potential to form part of the solution, but needs clear thinking and a consensus among all stakeholders.”

“But I am surprised at the reaction against the Tory’s lifetime savings proposal. I thought it would have been far more popular than it was. That makes me question how much appetite there really is amongst employers for bringing such a product to employees. Once you get government legislating aroud it, because it is in the workplace, you do not know what it will end up turning into.”