Over 3/4 pension professionals want further simplification of pensions

More than three-quarters (76 per cent) of members of The Pensions Net-Work (TPNW) would like to see a second attempt made at pensions simplification.

The members were quizzed at the latest meeting of TPNW, which focused on the issue of pensions simplification, and it was also found that more than two-thirds (68 per cent) would prefer a new simplified pensions regime that was designed for defined contribution schemes.

Attendees were those who had also attended the organisation’s first meeting in June 2006, which had also focused on pensions simplification.

Almost half (44 per cent) of the respondents said the one thing which they would remove or alter during the course of pensions simplification was the annual contribution allowance, including the tapering arrangements for high earners.

The second most popular answer was the removal or alteration of the lifetime allowance, which was favoured by just over two-fifths (41 per cent) of respondents.

TPNW added that consensus at the meeting was that achieving fairness across sexes, generations and different working patterns would be difficult and that trade-offs would be inevitable, while pressure for change in the UK’s pension system was seen as likely to come from “visionary politicians”.

TPNW chairman, John Moret, said: “Following such a strong response from TPNW members and leading industry figures, we were all left asking one question, could we be on the cusp of a second pensions simplification?

“Our latest virtual discussion did not disappoint and was a very appropriate way to mark the fifteenth anniversary of TPNW. The expert panel provided a great insight into the complex world of pensions legislation and the challenges that revisiting simplification would pose.”

While he noted there was “agreement amongst the panel and the audience that a second stab at pensions simplification was warranted”, Moret added that there was “concern about the most effective way of achieving this and the priorities that need to be addressed”.

He concluded: “There is a growing risk that pensions will become a marginalised savings product partly because of the legislative complexities at a time when changing working patterns and increasing longevity suggest more encouragement to long term savings is needed.”

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