There was a limited sense of surprise when the National Association of Pension Funds (NAPF)welcomed the report into the future of pension provision in the UK by Alan Pickering. Pickering is, after all, a former chairman of the NAPF.
Current NAPF Chairman Peter Thompson says the report highlights effective ways to strip away red tape, and so promote a modern, flexible future for company pension schemes. He highlights the following measures in particular:
- that legislation should be proportionate, and based on principle, not prescription;
- that there should be a new kind of regulator which would advise, as well as ensure compliance, and allow pension schemes to take a flexible, common sense approach, rather than a prescriptive application of detailed rules;
- that existing prescriptive regulation should be relaxed in order to safeguard valuable basic pension benefits, whilst maintaining benefits for existing pensioners and for past service; and
- that contracting-out rules should be simplified.
“Alan Pickering’s proposals could make life easier for those thousands of employers who voluntarily provide pension benefits for their employees. In doing so, they may persuade many employers to retain their pension schemes, where they might otherwise curtail or remove them. It is now vital that forthcoming proposals from the Inland Revenue lead to radical simplification of the tax regime for pensions, and that incentives both for employers and employees are introduced. However, the Pickering proposals offer a blueprint for practical steps forward and I urge the Government to follow this at the earliest opportunity. The NAPF will of course play a full part in any consultation on the implementation of Alan Pickering’s proposals.”