The Pensions and Lifetime Savings Association (PLSA) has announced six priorities for pensions ahead of the snap general election in June.

It says a strong pensions sector is key to a strong economy, and the six key areas should be a guide for party manifestos.

The six areas are the state pension, automatic enrolment, defined benefit schemes, pension scams, help at retirement, and tax relief.

Graham Vidler, director of external affairs, for the PLSA, said: "Over the last two years, a significant amount of work has been done to ensure the continued momentum of automatic enrolment and to help extend workplace pension saving to more people than ever before.

"We have also seen a welcome recognition from government of the need for action on Defined Benefit pensions."
PLSA said automatic enrolment will deliver a "real improvement" for millions of people's retirement incomes and the government can build on this success.

"It's essential that minimum overall contributions increase to at least 12% of salary by 2030, with steps taken now towards this goal," said Vidler.

PLSA added that the Government should extend automatic enrolment to include 18-21 year olds, self-employed people, and those in multiple jobs paying low salaries totally £10,000 or more.

PLSA also highlighted defined benefit (DB) pensions as a priority, saying they are underfunded with around three million people having a 50:50 chance of seeing their benefits paid in full.

"The Government should bring forward legislation to reduce burdens and enable pension schemes to share services or to merge, delivering better returns, saving money and improving governance," said Vidler.

"This will mean a greater chance of members receiving their benefits and it will free employers to focus on corporate growth and it will return public confidence to the system."

Pensions scams were also in the spotlight and PLSA called for legislation to establish an authorisation regime for pension schemes, as under current law, scheme trustees are powerless to stop the transfer even if they have concerns.

Vidler said: "The next Government needs to consolidate the growth of workplace pensions, increasing the reach of automatic enrolment and setting out a plan to raise contribution rates, and it also needs to make it easier for schemes to make DefinedBenefit pensions sustainable.

"Above all, it needs to build public confidence in the system, helping the industry fight scams and deliver the retirement choices savers want, while resisting the temptation for further raids on the pensions tax relief piggybank."

First published 11.05.2017

Lindsay.sharman@wilmingtonplc.com