Lord Turner’s proposals for a National Pensions Saving Scheme (NPSS) are likely to be ignored by most employers, according to research.
In November, Turner’s Pensions Commission proposed the introduction of an NPSS, 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 Develop-ment, reveals that most employers have no intention of changing their existing pension arrangements.
Of the 1,000 UK employers questioned, 81% intend to continue with their current arrangement regardless of an NPSS. With so few employers intending to switch to the NPSS, the scheme would only provide a minimum standards framework, the research said.
However, the survey also suggests that this, in turn, might promote better communication and understanding of pensions provision and a market opportunity for those employers with higher standards.
Fewer than one-third of employers (30%) believe that the NPSS would create a level playing field between firms, while just over one-quarter (26%) consider that it would represent a fair sharing of the cost of pension provision between employers, employees and the state.