The news comes as the Tories voiced their anxieties about personal accounts in the strongest terms yet.
At an Association of British Insurers conference on Tuesday, Shadow Secretary of State for Work and Pensions Theresa May said: “I am becoming increasingly concerned about the impact of personal accounts. When I first came into this job I started to be concerned and the latest implementation programme has exacerbated that concern.
“The basic question I am asking, and it is something we are trying to look at before the election but we need to have a proper review when we come into Government, is whether there is another way of achieving what was wanted.”
She refused to rule out scrapping personal accounts, which made the Personal Accounts Delivery Authority staff in the room visibly a little uncomfortable.
Anyway, the so-called plan B consortium, set up by IBM, includes providers such as Standard Life, Aviva, Legal & General, Friends Provident and Prudential.
The group, which had its first meeting via tele-conference last week, is proposing, among other things, a software platform where the employer or employee could choose a pension scheme from a range of pension providers as well as the personal accounts option.
A source from the group said: “Nothing is on the table but nothing is off the table”. Another source said they would look at whether stakeholder pensions could be revitalised.
The Conservatives have also approached pension providers individually, asking for ideas on how to improve personal accounts as well as suggestions for an alternative.
Shadow pensions minister Nigel Waterson confirmed that the Tories would be going into next year’s general election with “a plan B in our back pocket”. The party will enact a swift review of personal accounts if they get into power and have highlighted the fact no contracts will have been signed, for example with potential administrators, at that point.
Waterson says: “The current procurement plan as I understand it, involves signing contracts with the main providers in about June next year which actually ties in rather well with a possible election date. So what it means is by the time of the election, nobody is going to be committed to anything and it is a perfect opportunity to just review where we are and where this is all going.”
Last week Money Marketing broke the news that the Tories are considering lifetime savings accounts, which allow early access as well as workplace Isas.
What is your view? Would a software platform give people more choice? Is that a good thing for the low earning target market of personal accounts? What about stakeholder? Would that be a more cost-effective way to provide pensions for the masses? What would you do if you were in the Conservatives’ shoes?
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