Simpler Way to Better Pensions : An Independent Report

This Independent report makes a total of 52 recommendations on company, personal and private pension provision. The Government should introduce a new Pensions Act, which would change or scrap existing legislation. One of the proposals will be the establishment of a new pensions regulator, who can also act in an advisory capacity. The pensions system should be made simpler to understand, and more leeway should be given to pension professionals in exercising their judgment. Other proposals include allowing people to draw pensions while working past 65; ending the link between retirement income and inflation; allowing companies to stop paying pensions to sUrviving widows.To support the pensions system, a number of codes of practice should be put in place, backed by the Government, the new regulator and the pensions professionals. Certain regulations that now apply to employers would therefore be lifted, and the option should be open to employers to make membership of their pension scheme a condition of employment. Other proposals include a reduction of the number of generic pension products to just three: company-sponsored final salary plans; company-sponsored defined contribution plans and individual pensions based on the stakeholder pension model. The report also puts forward the view that employees should take more responsibility for their retirement plans, and that a simpler more accessible pension system would enhance this.