Commenting on Government proposals to introduce greater risk sharing and to remove regulatory constraints from the pensions system, Joanne Segars, Chief Executive, National Association of Pension Funds (NAPF), said today (Thursday):
“The Government’s Defined Ambition proposals herald a major step towards the creation of sustainable defined benefit and innovative defined contribution schemes. They will help create a framework to enable the development of a genuine mixed economy of pension provision, where employers are free to provide pensions which are right for them and their employees. They will go a long way towards helping to reinvigorate workplace pensions, in line with NAPF recommendations.
“But defined ambition will not be for everyone. Millions of people are going to be automatically put into a defined contribution pension, many for the first time. We must not get distracted from the task of getting good value for money out of this pension model. We have to step up efforts to improve transparency around charges and explore the benefits of economies of scale.
“The timing of any legislation will be critical, if employers contracting in their defined benefit pensions between now and 2016 are going to be able to take advantage of this new framework.
“As ever, the devil will be in the detail. It’s important that the Government works with the industry on how these proposals will work in practice and to ensure that any new regulatory framework is kept straightforward.“
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