The Pensions and Lifetime Savings Association (PLSA) has commented on the pension commitments in the Conservative manifesto.
Nigel Peaple, Director of Policy & Research, PLSA said:
“The Pensions and Lifetime Savings Association (PLSA) strongly supports the Conservative Party’s manifesto commitment to conduct a review into the discrepancies between net pay arrangements and tax relief at source for pensions.
“The discrepancy means automatic enrolment contributions for savers who earn between £10,000 and £12,500 are more expensive for those on net pay arrangements. It is our view that this can be fixed by adjusting the data gathering system used by HMRC.
“We are also pleased the Conservatives have pledged to reintroduce the Pension Schemes Bill which includes important measures to discourage reckless behaviour by a small minority of scheme sponsors, as well as a provision for the creation of a consumer-focused pensions dashboard. The initial dashboard must be non-commercial and no others should be introduced until a rigorous consumer protection regime is in place.
“We are disappointed the manifesto does not include any commitments to extend the scope of pension automatic enrolment to include younger workers, or lower paid workers with multiple jobs, and the self-employed.
“The manifesto also fails to commit to raising the minimum contribution levels for automatic enrolment from the current level of 8%.
“Less than 50% of all savers are on track to achieve an adequate income in retirement as defined by the Pensions Commission, and for those who only have DC pensions, only 3% of savers are likely to achieve this outcome.
“Our Hitting the Target report (2018) recommended raising minimum automatic enrolment contributions to 12% by 2030 with consideration given to moving to a 50/50 employer/employee split. This will improve pension adequacy and help more people achieve a better income in retirement.
“On the promise to “unlock” pension scheme investment in scientific discoveries, the PLSA supports broadening access to different asset classes but cautions that schemes must retain the freedom to invest in suitable assets in line with members’ best interests and not be forced to take on inappropriate levels of investment risk.”
Mark Smith, Senior PR Manager
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Steven Kennedy, PR Manager
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