The government’s proposed system of personal accounts will be run by trustees who would be legally obliged to handle the scheme’s assets in the best interests of members.
The board of trustees will have responsibility for setting the strategic direction for the scheme from the collection of contributions to the investment of assets and payment of benefits.
There would also be a members’ panel to ensure that members’ views were taken into account by the trustees running the scheme, into which employees across the UK will be enrolled when they are introduced in 2012.
Work and pensions secretary John Hutton told a National Association of Pension Funds conference in Manchester: “Personal accounts will be the biggest step forward for workers seeking to build up a pension since National Insurance was introduced in the 1940s.
“But if we are to make them a success for the millions of people who currently aren’t saving for a pension, we must put in place measures to ensure they have the interests of future members at their heart.”
Hutton emphasised that personal accounts would be run independently of government, and that the scheme would remain focused on its target group of employees who did not have access to a good workplace pension scheme.