Lord Turner’s proposals for a national pensions saving scheme (NPSS) are likely to be ignored by the majority of employers, according to latest research.
In November, Turner’s Pensions Commission proposed the introduction of a National Pensions Savings Scheme, under which employees who opted in would contribute 5% (1% being National Insurance tax relief) with employers forced to add 3%.
But the latest quarterly Labour Market Outlook from the Chartered Institute of Personnel and Development (CIPD) and KPMG reveals that most employers have no intention of changing their existing pension arrangements.
The survey of almost 1,000 UK employers shows that 81% intend to continue with their current arrangements.
With so few employers intending to switch to the National Pensions Savings Scheme it will only provide a minimum standards framework, the research said.
However, the it suggests that this, in turn, may promote better communication and understanding of pension provision and a market opportunity for employers with higher standards.
Less than a third of employers (30%) believe that the National Pensions Savings Scheme would create a level playing field between firms, while even fewer (26%) consider it would represent a fair sharing of the cost of pension provision between employers, employees and the state.