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.
Is it time to review your pension-fund arrangements?
Even though the UK pension sector is going through something of a transformation it appears that more and more people will need to make their own pension arrangements in the future. Today's announcement that 1.85 million people in the UK are aged 85 years or more is great news but will ultimately speed up the timescale towards personal pension arrangements becoming vital in the future.
Public sector pension funds need to be reformed
The chairman of the London Pension Funds Authority, the largest council pension fund in the UK, has today joined calls for the next government to introduce a wide ranging review of public sector pensions. This comes just ahead of next month's revaluation of council pension funds which is expected to show a deficit of around £70 billion! It is believed that council pension funds are only two th...Read More
Types of Pension
The type of pension scheme you end up with will broadly depend on your situation and your goals for retirement. There are a number of different schemes available, and you can have more than on e at any one time.
Below is a bit of detail about the most common types of pension, and how you can go about starting a scheme.
Company / Occupational Pension
This type...Read More
Are pensions compulsory ?
Around 268,000 employees in the UK don't have a pension. At the moment, having a pension is not compulsory; however this is subject to change and suggested schemes such as the Government’s Personal Account could mean that in the future we are required to hold a pension scheme. As an example, the Personal Account scheme would have an "opt out" option, but every employee in the UK will be enrolled...Read More
Pension Annuities Under Investigation By The FSA
The Financial Services Authority (FSA) is currently carrying out a serious investigation into the annuities market with many concerned that those with maturing pension plans are not being given impartial advice. Unknown to many pension fund holders, they are actually allowed to shop around for the best annuities on the market, rather than automatically purchase an annuity from their pension fund...Read More