The Department for Work and Pensions has appointed the Association of British Insurers to come up with a pack of information that employers can give to employees regarding the pension scheme they offer.
According to Andrew Smith, Work and Pensions Secretary, employers will soon have to disclose their pension provision in job adverts through Job Centres. He said that he wanted to ensure all employees got access to the information they needed.
Our View
In theory, pension packs are a good idea. But, those packs are technically already available through Stakeholder Pension joiner packs.
As with the joiner packs, the pension packs are unlikely to be given the attention they need by employees and we do not see the take-up of pension membership increasing greatly. Many employers feel pressured into offering and administering pensions for their staff and do not really want to do any more. The Government knows that more people need to save for their future but this dos not seem the right way about it. If Government actually gave incentives to join pension schemes, rather than tax relief and tax-free cash, more people might take them out. Also, if the Government actually approved or put their name to a selection of pension schemes, maybe people would feel happier investing their money.
We still believe there is a long way to go.