Forum Brief: Pensions

A simplification of the "unbelievably complicated" pensions system is set to be recommended by the government-appointed independent Pensions Commission.

Government Response: Department for Work and Pensions

A spokesperson for the DWP said: "We believe the key thing is to ensure that information on pensions options is as straightforward as possible and that all the information is relevant.

"In February we published the Informed Choice document which enables us to work with employers and pensions providers to ensure people make better choices when it comes to pension options."

Forum Response: Institute of Directors

Derek Brownlee, pensions analyst at the Institute of Directors, said: "Many people have unrealistic expectations about when they will be able to retire, and how large their pension will be, so impartial pensions advice and education is needed.

"It's very important that the government looks at what is stopping people saving adequately for retirement and realises that people will not be able to save more into pensions when they are being hammered by ever increasing taxes."

Forum Response: Age Concern

Gordon Lishman, Age Concern's director-general, said: "With pensioner poverty at crisis levels and half of all pensioners relying on means-tested benefits, it is right to examine different strategies for improving pensioner's incomes.

"The current basic state pension fails to cover daily living costs and the complexity of the system prevents many from planning effectively for retirement.

"Any moves to relax employers' mandatory retirement ages would help to improve flexibility in later life.

"However the government must not raise the state pension age as part of pension reform. If the government pushed forward with this option, manual workers would be most likely to suffer.

"Manual workers generally have lower life expectancies than their white-collar counterparts and are also most likely to depend on the state pension.Raising the state pension age would lead to a 'two-tier Britain', where the least well off would be forced to work longer in back-breaking jobs while richer pensioners would retire early anyway.

"The priority should be to address the fact that one third of people aged between 50 to state pension age are not working, many due to age discrimination, so are unable to make adequate provision for retirement.

"The government must also increase the state pension to at least £105 a week to ensure all pensioners have enough to cover basic living costs and the security to build-up their own retirement income."

Forum Response: National Consumer Council

Ed Mayo, chief executive at the National Consumer Council said: "NCC research shows that half of adults say they don’t trust the pensions industry. And half of those questioned think government has a responsibility to offer better financial incentives to save – a voucher scheme rather than regressive tax breaks.