NAPF: Turner says pension system unfit
UK - Adair Turner says that almost all the new information gathered since his Pension Commission’s first report last October has confirmed that the existing system “is not fit for purpose”.
Turned told the National Association of Pension Funds’ annual conference in Manchester that if the committee had to write the report again it would be more categorical.
“The inequalities of provision which we described in the first report are becoming still more striking,” he told delegates.
Turner said the Commission has been “supplementing, deepening and checking” its analysis of the current situation as well as considering what new policies may be needed.
The committee is to deliver its recommendations by November 30.
“The steady flow of private sector defined benefit scheme closure is continuing,” albeit at a slower pace, he said. “As a result, the most dynamic element of private pension saving is focused on the past not the future.”
There was no indications of a take-off in pension saving or participation - nor signs that personal pensions are growing to counterbalance a declining employer role.
“These factors together imply that the aim of successive UK governments, Labour and Conservative, to shift the balance of pension provision from the state to the private sector, is simply not being achieved, and will not be achieved on unchanged policies.”
“The question therefore is no longer what is the situation, but what should we do about it.”
He stressed the need for a coherent pension policy, rather then relying on the “muddle through” option highlighted by the commission report, to tackle what the commission is reluctant to label the “savings gap”.