ABI Calls for Immediate Automatic Pensions Enrolment
By Catherine Couch, The Financial Adviser
November 18, 2008
The Association of British Insurers (ABI) has called on the government to boost pension saving by allowing automatic enrolment into good workplace pensions schemes now rather than in 2012.
Speaking at the Global Financial Leadership Forum in New York, Stephen Haddrill, director general of the ABI, said after having been on a binge of debt, many consumers were putting every spare penny they have into reducing their loans, rather than saving for old age.
He warned the government's apparent plan to reduce tax rates for those on lower incomes could reduce the tax incentive to save in a pension and may make the problem worse.
Haddrill said: "The government has agreed that after 2012, employers with existing good insurance-based pension schemes should also automatically enrol. We are now calling on them to allow that immediately to boost saving.
"We are also urging them to mount a major campaign to explain the need to save for retirement."
The ABI said it was also acting to boost confidence in pensions and savings by calling on the regulator to improve the quality of sales intermediaries, including agents or independent advisers.
Haddrill said: "We wish to see adviser commission and the bias it causes in sales eliminated. We also want to see higher professional standards in the advice giving industry."
"Poor experience of advice has damaged confidence for too long. And commissions have encouraged too much churning of investments."
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