ABI comments on measures announced in The Queen’s speech on pension reforms
Association of British Insurers
Two Pensions Bills - the Pensions Tax Bill and Private Pensions Bill - are to be introduced into Parliament, it was announced in the Queen's Speech today.
Commenting on the measures announced in The Queen’s speech regarding pension reforms, Otto Thoresen, ABI Director General, said:
"The pension reforms announced in the Budget have radically changed the savings landscape in the UK and will give savers in defined contribution schemes complete choice over what to do with their pension savings at retirement. ABI members are working on how best the impartial guidance promised by the Chancellor can be delivered to savers so that they can consider their options and choices.
"Collective Defined Contribution schemes seem to take us in a different direction from this emphasis on individual choice so recently given to savers. Claims as to the benefits of such Collective Defined Contribution schemes are exaggerated and make comparisons based on old style products which are no longer representative of the current market, particularly post the Budget changes. There are issues about intergenerational subsidy and transparency which could prove challenging in today’s society. However, different approaches to pension provision have advantages and disadvantages and it’s good that we consider them, but the key point we need to focus on is how to encourage people to save more for longer in quality schemes so that they can have a decent retirement income.”
