UK occupational schemes need simplifying says NAPF
UK- Consumers in the UK are confused about their own pension arrangements, according to a survey by the NAPF, further supporting a call by the new pensions ombudsman, David Laverick, for a simplification of company pension schemes.
Results from the NAPF survey showed that 23% did not know what proportion of their annual earnings they or their employer were contributing towards a pension. Only about 15% of those interviewed thought they and their employer were contributing the recommended 20%, while around 37% thought they were contributing nothing at all.
Worryingly only 24% of the cross-section were certain they were investing enough to provide for a decent pension, and while aware that greater life expectancy poses a growing threat to state pensions provision, the average age at which respondents expected to retire was 61.
Says NAPF chief executive, Christine Farnish: “whilst consumers know they are perhaps not saving enough, they are not sure what to do about it. The system is far too complicated.”
As a result of the survey, the NAPF is putting together a series of proposals to make occupational pensions more simple and accessible.
Last week, David Laverick proposed in his first annual report since his appointment last autumn, that, rather than a multitude of schemes with separate sets of rules, someone should produce perhaps just three or four “model schemes.”