UK – The UK’s asset management trade group has come out in defence of Lord Turner’s Pension Commission proposal for a National Pensions Savings Scheme, saying the idea is “perfectly workable”.

The Investment Management Association said the centrally managed model put forward by the Commission would stand “the greatest chance of success”.

“A properly constituted, independent and fully accountable board would provide crucial oversight on behalf of scheme members in the way that trustees do for members of occupational pension schemes,” the IMA said.

The response puts the IMA at odds with the National Association of Pension Funds, which has sharply criticised the NPSS idea and proposed its own ‘super trusts’ plan.

“If the government is going to go for this scheme, it is clear that the right way is to build on well established structures in the institutional pensions market, and not to treat the scheme as if it were offering retail products,” said IMA chairman Richard Saunders. “The scheme as broadly proposed by the Commission is therefore perfectly workable.”

He added there had a lot of “misleading comment” about the NPSS recently.

Turner himself has come out and identified two "red herrings" which are confusing the debate. He confirmed that the idea does not involve a national direction of saving but in individual accounts.

And he said the NPSS default fund would “certainly be no riskier to government than the alternatives."

The IMA argues that scheme members would be able to get access to professional institutional management of their investments – and that economies of scale and competition would value for money.