Speaking at the National Association of Pension Funds (NAPF) chairman's dinner earlier this week, Webb said: "Could we move away from the strict divide between defined benefit and defined contribution? Is there a third option, which would ensure that individuals are not left to shoulder the entire risk of their pension saving, and employers can offer pensions within a lighter touch regulatory regime? "A 'defined aspiration' pension could allow employers to offer a measure of security to their staff, but would have a degree of flexibility that would recognise when external factors - be it increases in longevity, or significant changes in market conditions - make a firm promise impossble to keep." 28 February 2012 Consumers have been warned to steer clear of pension offers that claim to be able to provide loans or release tax-free cash from people’s pension pots before they reach age 55. The Pensions Regulator, Financial Services Authority and HMRC have recently detected an increase in these schemes, with known transferred funds amounting to nearly £200m by the end of 2011. The organisations are urging individuals not to be taken in by website promotions, cold-calls or adverts encouraging them to transfer their existing occupational or private pension to a new arrangement in order to access a cash payment or loan. These schemes usually work by transferring some of the member’s pension fund into highly risky or opaque investment structures, frequently based overseas - with no guarantee that members will get their money back if something goes wrong. By accessing pension savings earlier than the law permits, individuals are likely to be poorer in retirement – and can face substantial tax charges. Victoria Holmes, case team leader at The Pensions Regulator said: “These offers are typically advertised on websites or small adverts in newspapers. If the offer sounds too good to be true, it probably is. It may simply be a scam designed to get hold of your money. Transferring your pension to one of these questionable investment models could result in you losing your entire pension. Read the full press release from The Pensions Regulator 12 March 2012 The CIPP is disappointed to learn that a significant number of employees will opt out of the company pension scheme if auto enrolled due to a lack of trust in the pensions industry. According to figures from the National Association of Pension Funds (NAPF), 33% of workers eligible to join a qualifying workplace pension scheme intend to leave. Professional Pensions reports: When asked why, 40% said that they do not trust the pensions industry. Some 35% of workers polled said they could not afford to contribute to workplace pension, and 23% said they did not trust the government on pensions and would quit their scheme. WARNING AGAINST EARLY RELEASE PENSION OFFERS NAPF POLL FINDS EMPLOYEES HAVE LOW CONFIDENCE IN PENSIONS INDUSTRY
CIPP Policy News Journal
09/10/2012, Page 179 of 234
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