UK– The government is this week publishing two reports containing plans to simplify the range of pensions available and to break down the barriers to saving. Both reports call on the government to reform the way pensions and savings products are sold so they can effectively be bought “off the shelf”.

A report by former Lloyds CEO Ron Sandler on medium and long term savings will appear tomorrow, followed on Thursday by one on pensions simplification by Alan Pickering, former chairman of the NAPF.

Both reports claim “off the shelf” pensions and savings products would be made possible if the government were to legislate to make the product, and not the way it is sold, subject to regulation. Both authors claim this would simplify the savings process and allow pensions to be sold with minimal advice.

Among his other principal recommendations, Pickering is calling on the government to re-introduce compulsory company scheme membership and to reduce the range of pension products available from over 20 to just three or four. He would also like to see companies have more control over the structure of the pensions they offer.

Sandler will recommend that investors make increasing use of index tracker funds and that they switch from active to passive management in order to cut costs.

Richard Saunders, chief executive of the Investment Management Association, claims the idea that active is more expensive than passive management is misguided, since the higher costs are usually attributable to fees paid to consultants.