The government has defended its target of implementing personal pension schemes in April 2012, despite comments from the chief executive of the new delivery body suggesting that the plans may be delayed.
Tim Jones, chief executive of the Personal Accounts Delivery Authority, was recently quoted as saying that the target date of 2012 might not be achievable. “As incoming chief executive, it makes sense for me to review the plans,” he said.
When pressed if he might tell the government that the launch would have to be later than 2012, he said: “There is that possibility, yes.”
Personal accounts regulations will force employers to enrol all their staff into their pension schemes if they are not already members. If no scheme exists, staff will automatically become members of the government’s new planned scheme.
Employees will contribute a minimum of 4% of their earnings, matched by a minimum 3% employer contribution and 1% in the form of tax relief from the government.
The Pensions Bill, which will introduce the relevant legislation, is due for its crucial second reading in Parliament this week.
A spokesman from the Department for Work and Pensions told Personnel Today: “It’s important to emphasise that Tim Jones said he had not seen anything to say 2012 was unachievable, but he would be looking at this in his role as chief executive.
“He said it was important that the design of the scheme was right before it was introduced.”
Last week the Association of Consulting Actuaries warned that more final salary pension schemes may be closed because of the government’s personal accounts, with employers just relying on the new system.
