Pension News Scheme Launched To Encourage Workplace Pensions
12 May 2003
The National Association of Pension Funds (NAPF) has launched a new initiative to encourage Britain’s smaller employers to offer staff workplace pension schemes.
The NAPF is setting up a working group to investigate ways to encourage multi-employer pension schemes, which give a new option to smaller companies who might find it difficult to offer an occupational pension scheme on their own.
The organisation states that the UK currently has very few multi-employer schemes and aims to promote development of the pensions by:
Identifying obstacles to the development of such schemes, especially through the tax regime.
Recommending how to remove those obstacles.
Identifying ways in which the NAPF can provide practical help in setting up such schemes.
NAPF Chief Executive, Christine Farnish, explained, ‘Workplace pensions are still the best option for most people seeking to build a comfortable retirement income. Yet millions of working Britons, particularly those working for smaller firms, do not have access to an occupational pension.’
‘Multi-employer schemes are well-established in the Netherlands where around 90 per cent of the workforce benefit from occupational schemes. If we are to build a sustainable pensions system for the 21st century we must explore every option, and multi-employer schemes could play a key role.’
‘They take the hassle and cost of running individual schemes away from employers, and, with the right tax regime, could offer a new pensions option for Britain’s thousands of small and medium firms.’
According to a survey by the Pensions Policy Institute, four-out-of-five companies with over 1000 employees offer an occupational scheme while only one in seven firms with fewer than 50 employees do.
The NAPF Multi-Employer Working Group will by chaired by Richard Stroud of the Pensions Trust, and will include representatives from the Inland Revenue, pension lawyers, and existing multi-employer schemes. It is hoped the working group’s work will feed into the Inland Revenue’s current review of pensions taxation.