New analysis from the International Longevity Centre UK (ILC-UK) paints a "bleak picture" for future pensioners.

The report, Pension Commission: 10 Years On, highlights positive progress in terms of the extension of working lives and encouraging more people to save – but warns against complacency.

It says the average age of exit from the labour force is increasing, but it is still below where it was in the 1960s and 1970s – and the average time spent in retirement is increasing.

The report also found that auto-enrolment has delivered a growing number of employees with workplace pensions, but median contributions rates are low and a growing number of people have no savings.

ILC-UK chief executive Baroness Sally Greengross highlighted the need for effective financial planning for future generations.

She said: "The Pensions Commission can claim credit for successful public policy change – auto-enrolment has got more people into the long-term saving habit and relative pensioner incomes have increased."

"However, the future for retirement income looks less rosy and the new single tier pension will be less generous for the majority in the long term with fewer people finding themselves receiving the more generous final salary pensions.'

Making the wrong decision, she said, could result in people living longer than their money and that "navigating the retirement income maze" would require better information, advice and financial capability."

The future of the pensions industry will be discussed by a panel of experts at the ILC-UK's second National Retirement Income Summit in June.

Hosted by the Chartered Insurance Institute, the event has speakers including former Pensions Minister Steve Webb.

David Thomson, director of policy and public affairs at The Chartered Insurance Institute, endorsed the idea of a new cross-party Pension Commission.

He said: "Now that the Budget has been published and Lifetime ISAs unveiled to improve savings among younger adults, these announcements afford the Government extra time to revisit the idea of a Pensions Commission to explore the more complex question of wider pensions tax relief."

First published 07.04.2016

Lindsay.sharman@wilmingtonplc.com