Government reviews pension enrolment guidelines
The UK government is believed to be reconsidering the level at which employees in the UK would be automatically enrolled into a pension scheme as well as a potential exemption for small companies. The original changes, which would see hundreds of thousands of employees in the UK automatically enrolled into pension schemes, are set to come into play in 2012 although we may see some changes to the original guidelines before then.
The proposed changes could see the threshold for joining such schemes increase from £5,000 per annum to anywhere from £10,000 per annum. The main concern of the government seems to be the possibility that a very small pension fund would in reality simply replace means tested benefits and be of little assistance to low-income workers in the UK. Whether this is the case remains to be seen but the authorities are certainly reconsidering their initial recommendations.
A number of authorities in the UK representing small businesses have been lobbying the government for some time for exemptions for those with fewer than five employees where potentially the cost of setting up the arrangements becomes "non-cost-effective". We are likely to see major changes between now and the proposed introduction date of 2012 with a number of different authorities and bodies around the UK lobbying the government for a number of changes.
Poll results: Pensions are most confusing financial product
Which financial products do you feel least confident handling yourself?
Mortgage – 18.2% Pension – 45.5% Debt – 9.1% Savings – 27.3% Insurance – 0%
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IMF highlights UK pension and healthcare systems as concerns
The International Monetary Fund (IMF) has this evening highlighted the UK pension and healthcare systems as potential concerns for the future. The IMF believes that these two issues need to be resolved as soon as possible to pave the way for a recovery in UK finances at a time when other countries appear to be in recovery mode, while the UK is consolidating at best.
It is no secret...