The Association of British Insurers has launched a “wide-ranging” review into the UK retirement system and suggests “radical reform” is needed to help savers.
The ABI says the review will aim to tackle a “chronic under saving culture” in the UK and will focus on people’s financial needs in and concerns about retirement, how effectively the state and retirement income products cater for retirement needs, and what changes are needed to ensure adequate retirement incomes.
The ABI says it is seeking views and evidence from savers, pension experts, think-tanks, consumer groups, health organisations, politicians and trade unions.
ABI director general Otto Thoreson (pictured) says: “How we pay for life after work is one of the key challenges facing our society, and the reason we have launched this wide-ranging review. Radical reform is needed to ensure people retiring today and future generations avoid a retirement of struggling to make ends meet.
“Reform has to be holistic. The pensions industry has a key role to play in meeting people’s changing retirement needs but we are part of a much bigger picture.”
ABI director of policy Huw Evans adds: “It is becoming increasingly clear that we need to consider a new approach to meeting people’s changing retirement needs.
“Rising life expectancy, a sustained low interest rate environment and our culture of under-saving means that our current approach to retirement is unlikely to be fit for the future.
“We need to think about what changes may be needed to meet the needs of the savers of today when they face retirement.”
The consultation will close on 20 December. The ABI will then hold a series of stakeholder workshops in early 2014, with the final proposals due to be published in spring 2014.