Workers may be forced to contribute to private pension schemes, according to the new work and pensions secretary David Blunkett.
In an interview with the BBC earlier today, Blunkett said all options for reform of UK pensions remain open and that he was considering some means of forcing people to save for their future.
“I’ve ruled nothing out,” he said. “I have not ruled out the issue of some means of ensuring people do save.”
Last year, a pensions report estimated that more than 12 million people are not saving enough for their retirement.
Blunkett hinted that people would have to start taking greater responsibility for funding their retirement. “We have got to look at the point when people start saving for themselves,” he said.
“The issue is not tax versus saving, [or] the question of how long people work. It is what people are prepared to do for themselves, and how we as a government support, enable and facilitate them doing it for themselves.”
Malcolm Rifkind, the shadow work and pensions secretary, said the government needed to make saving more attractive.
“We have to find ways of creating an incentive for people to save and the government must set an example by creating these incentives,” Rifkind said.
Liberal Democrats’ pensions spokesman Steve Webb said Blunkett’s first priority should be to sort out the state system.
“We need a simple state system that will make private pensions work better,” he said.
The director general of the CBI employers’ organisation, Sir Digby Jones, urged the government to avoid choosing a “one-size-fits-all approach”.
“Everyone recognises the huge challenge ahead but although a simplistic panacea may have appeal, a more sophisticated mixed solution will have longevity and provide the long-term stability we all seek,” he said.
He also warned against making contributions to pensions compulsory.
“Compulsion is not the answer, it would be viewed by both employers and employees alike as yet another stealth
