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Pickering recommends scrapping spouse benefits and index-linking

Pickering’s report into pensions legislation is recommending the removal of spouse benefits and index linking in a bid to stop employers closing defined benefit schemes.

It says the Government should remove the requirement for occupational pensions and the protected rights element of private pensions to rise in line with the retail price index. This would not apply to any benefits already accrued. It says removing the requirement will enable employers to continue offering a defined benefit scheme rather than moving to a money purchase scheme with lower contributions. This would not stop parties coming to individual agreements that would continue index linking.

The report says that in a modern world many couples would prefer to make their own arrangement to have separate retirement income. Survivors’ benefits, it says, should be determined by individuals, employers and providers rather than by rules.

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