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Tories might scrap personal accounts and auto-enrol into stakeholder

Conservative Shadow Work and Pensions Secretary Chris Grayling has said the Tories would consider scrapping personal accounts in favour of auto-enroling employees to existing stakeholder schemes.

Speaking at an Association of Consulting Actuaries dinner yesterday, Grayling said the Conservatives were growing increasingly concerned about the costs of delivering personal accounts.

He said that initially ministers had promised the scheme could be delivered at an administration cost of 0.3 per cent, but now they were talking about a cost of 0.5 per cent.

Grayling said: “If Personal Accounts don’t break new ground in cheap, affordable pension products, then there is no point in them.

“There is no point reinventing the wheel if what we get is going to look just like the things we already have.

“The private sector spent vast amounts setting up Stakeholder. Let’s not do all of that again unless the results really are going to offer us something different.”

Grayling said that if the Conservatives were elected within the next 18 months it would go through the Government’s work on pension reforms “with a fine toothcomb” and would not hesitate to make changes.

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