View more on these topics

Tories to review basics of personal accounts

Tory Shadow Work and Pensions Secretary Theresa May has hinted in the strongest terms yet that the Conservatives may scrap personal accounts if they win the general election.

Money Marketing recently revealed the Tories are furious about the Government’s decision to delay the imp- lementation of auto-enrolment, with Shadow pensions minister Nigel Waterson claiming it “casts a shadow” over personal accounts.

Speaking at an Association of British Insurers’ conference in London last week, May reiterated the party’s plans for an immediate review if it comes to power, adding that she is becoming “increasingly concerned” about the scheme.

She said: “I want to have a review pretty quickly because I recognise that the clock is ticking. 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 is whether there is another way of achieving what was wanted. 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.

“It may be that personal accounts are the right way forward. There was a consensus at the time, so maybe the review will come up and say right this is the only way that makes sense but I have my concerns about the impact it will have on pension savings overall.”

May is worried that the scheme could result in more people saving into a pension but lower pension savings as a whole. She said: “The prize must be more people saving and increased savings as a whole. That is the fundamental question, are personal accounts going to achieve the latter or the former?”

She voiced concerns about a potential future misselling scandal. She said: “I also have a longer-term concern of the potential impact of people saving into this mechanism realising down the road they have not saved for the comfortable retirement they thought they were being told they were saving for turning round and accusing the Government of the day of misselling.

“It is not usual for Governments of today to think about the impact on Governments of the future but I think it is important.”


News and expert analysis straight to your inbox

Sign up


    Leave a comment


    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