The ABI believes the Pensions Commission’s report should be a springboard for closing the savings gap, rather than causing further delay.
Director general Stephen Haddrill says says Turner can use lessons from the existing private sector to improve Britain’s public sector pensions issues.
Haddrill says that although the ABI supports automatic enrolment into pension schemes, with a matching employer contribution where the employee does not opt out, he says the association does not believe in creating a new, expensive and risky “state quango”.
He questions whether Turner’s proposals will allow Britons to gain a head start on pension at a reasonable cost, as is the case for larger company schemes.
Haddrill says: “The ABI supports automatic enrolment into pension schemes, with a matching employer contribution where the employee does not opt out. But we dont need to create a new, expensive and risky state quango; we should use the expertise and infrastructure of our existing private sector to put this vision into effect. Doing so will give Britain a head start.
Adair Turner questions whether the private sector can do this at an acceptable cost. Provided that we are asked to deliver the same service under similar conditions, we believe that we can. As Lord Turner notes, we are already doing so for larger company schemes.”
It is clear that Britain faces a pensions gap and that urgent reform of the state system and private saving is needed. People need to save more for their retirement, and they need help and encouragement to do so.”