Group corporate self-invested pension plans (SIPPs) are increasing in popularity among UK businesses, with 27 per cent of respondents to a PricewaterhouseCoopers (PwC) survey saying that they plan to make this their main pension arrangement.

Seven per cent of respondents were found to already have implemented a corporate SIPP, and PwC said it is advising a number of FTSE100 companies in this area.

PwC said corporate SIPPs can offer greater investment flexibility, including the ability to invest in employer shares, and pensions accounts can receive assets in specie from company share plans, incentive plans and other pension arrangements.

Marc Hommel, partner and UK pensions leader at PwC, said: "With the increasing exodus of employers from defined benefit pension provision, employees are accepting the need to take personal responsibility for their retirement savings. As such, they are looking to their employers to provide access to understandable and affordable savings vehicles. More employers are starting to appreciate the benefits that group corporate SIPPs offer by giving employees flexible and cheaper retirement savings opportunities than they could secure on their own."

The survey also found that 83 per cent of employers are concerned about lack of value for the money they are shelling out on pensions provision. 45 per cent of this number said they intend to take into account the fact that different employees at different life stages attach different value to pensions.

"There is no point in a business spending large amounts on generous pension arrangements that are undervalued by employees," Hommel added. "Many employers are thinking very hard about how much money they can and want to spend on pension provision, and how this money is best spent. We are seeing far more imagination in the type of pension arrangements being offered and the vehicles being used to deliver these."

The fourth annual PwC Pensions Survey was completed by 98 companies.

- Pensions Age February 2009

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