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MPs make callfor compulsory pension saving

An influential Parliamentary committee is calling on the Government to make saving for retirement compulsory.

The social security select committee says it may be necessary to force people into saving for their retirement.

It says this is especially important for those on lowto moderate incomes whoput saving for their retirement at the bottom of their list ofpriorities.

The committee feels thatpeople on low and moderate incomes are being excluded from pension reform and it wants the Government to take more action to ensure their futures are secure.

But the Department of Social Security argues there is already a degree of compulsion in the system and to increase it would not benefit people on the lowest earnings because they simply cannot afford to save anymore.

The DSS says its reforms, such as state second pensions and stakeholder, will help to address the problems.

The committee recommendation comes as part ofthe Contributory Principle report, which looks at all aspects of pension reform.

The committee is now conducting a study on pensioner poverty and it intends to narrow the scope of its focus.

Committee member Labour MP Gareth Thomas says: “We take the view that the Government has an obligation to provide a fair and reason-able platform upon which people can save for the future.”

A DSS spokesman says: “We are considering the recommendations made in the report and will make our decision in due course. There is compulsion in the system already through the National Insurance scheme.”

Former DSS minister and outspoken backbencher Frank Field says: “It is impossible for pension reform to succeed without extending compulsion. People know they should save but they don&#39t.”


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