UK firms are facing up to £2.5 billion in fines due to the
slow implementation of stakeholder pensions, according to the latest research.
The government launched the stakeholder initiative in April
in a bid to increase the number of employees saving for retirement, but more
than one in ten firms has yet to set up a scheme.
These companies will be fined up to £50,000 if they fail to
the meet the government’s October deadline.
Overall 88 per cent of companies surveyed say they are aware
of the new regulations but two-thirds have not yet begun consulting staff on
what form of scheme they would prefer and so far only 42 per cent of UK firms
have implemented a stakeholder pension.
The research was carried out by Virgin Direct, which surveyed
500 medium-to-large companies.
Meanwhile, a report by the Institute for Public Policy Research
has warned that the Government’s pensions policy is in danger.
The report claims that four months after the launch of
stakeholder pensions there are growing doubts that the new money purchase
pensions will reach the target group – those earning between £9,000 and £18,000
a year, who do not have second pension provision.