Smaller companies actively discourage employee pensions

Finance
directors at small to medium-sized enterprises doubt company pension schemes
benefit their businesses and actively discourage employees from joining them,
research claims.

A
study by the Pensions Institute at Cass
Business School
shows that many finance directors are not convinced that "pension schemes
attract, retain and motivate staff".

In
many cases, employers impose strict curbs on employee participation in their
defined contribution schemes, the report says.

Christine
Farnish, chief executive of
the National Association of Pension Funds, said the report shows the real
reasons why the UK
is facing a savings crisis.

“There
is scepticism among finance directors about the value of workplace pensions in
recruiting and retaining staff, and similar unease among employees about the
value or purpose of joining such schemes,” she told the Financial Times.

Financial
advisers said the report’s findings reflected their experience of smaller
company decision-making.

Earlier
this week Alan Johnson, the pensions
secretary, told the Labour Party conference that the Government would introduce
measures to encourage more employees to participate in occupational schemes.

By Daniel Thomas

 

 

 

 

 

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