View more on these topics

Ritchie warns of ‘opt-out culture’ from NPSS

Employers could create an opt-out culture from the Pensions Commission’s National Pensions Savings Scheme by offering pay rises to discourage employees from joining their pension schemes, warns Stewart Ritchie.

Scottish Equitable’s director of pensions development told an NAPF seminar that employers could offer as much as a 6.5 per cent pay rise as an incentive to employees to opt out.

He said employers could claim that the employee’s 5 per cent default contribution could instead be given as cash in hand along with half the employer contribution of 3 per cent, as set out by the Pensions Commission.

He said this disincentive could be stopped if there was advice in the workplace to ensure employees were making sensible decisions about retirement planning.

Ritchie said: “An opt-out culture in SMEs could amount to a risk of worst of all worlds if there is levelling down without levelling up. The only way this behaviour can be curbed is with advice.”

Watson Wyatt senior consultant Stephen Yeo says: “The Turner report failed to take into account in its statistics that there are employers who have chosen not to take up auto-enrolment and still may not want to, if forced to, and may get people to leave the NPSS.”

Recommended

Cofunds Increases assets under administration by 71 per cent in 2005

Cofunds has increased its assets under administration by 71 per cent from 3.5bn to 6bn in the year to January 2006. Cofunds believes this makes it the largest intermediary-only platform in the UK. It says it is attracting new intermediary firms to its platform each month and getting further support from existing clients. Managing director […]

Standard Life launches Dublin centre

Standard Life is entering the offshore market, this week launching their international office in Dublin. The life company told Money Marketing in June it would be opening the office in early 2006, having submitted its application in March 2005 for Standard Life International Limited, which has now been approved by the regulator.Chief executive Murray Drummond […]

Happy medium

Medium-sized companies put in a remarkable performance last year and the prospects remain good

International jurisdictions

By Neil Jones, Canada Life Investing through international providers has grown in popularity over recent years as investors seek out the benefits of gross roll-up and the wider range of investment options that can be available. When considering a recommendation for a lump sum investment, not only does the adviser have to select a suitable tax wrapper […]

Newsletter

News and expert analysis straight to your inbox

Sign up

Comments

    Leave a comment

    Close

    Why register with Money Marketing ?

    Providing trusted insight for professional advisers.  Since 1985 Money Marketing has helped promote and analyse the financial adviser community in the UK and continues to be the trusted industry brand for independent insight and advice.

    News & analysis delivered directly to your inbox
    Register today to receive our range of news alerts including daily and weekly briefings

    Money Marketing Events
    Be the first to hear about our industry leading conferences, awards, roundtables and more.

    Research and insight
    Take part in and see the results of Money Marketing's flagship investigations into industry trends.

    Have your say
    Only registered users can post comments. As the voice of the adviser community, our content generates robust debate. Sign up today and make your voice heard.

    Register now

    Having problems?

    Contact us on +44 (0)20 7292 3712

    Lines are open Monday to Friday 9:00am -5.00pm

    Email: customerservices@moneymarketing.com