Employers have three choices to amend company pensions with the introduction of the National Pensions Savings Scheme (NPSS), according to an analyst.
Adrian Boulding, the pensions strategy director for Legal and General, makes the comments in the latest edition of Driven to Retirement.
Options available to companies are to add auto-enrolment onto an existing company pension scheme, which would almost double the organisation's pension bill, which Mr Boulding does not believe is likely.
Another option is to introduce auto-enrolment on company pensions, but reduce contributions to national Pensions Savings Scheme level, which Mr Boulding describes as potentially a "very sad" idea.
Alternatively, employers could adopt an "offset model", as Mr Boulding explains: "They maintain their existing scheme but without adding the auto-enrolment."
"They just change their scheme rules to say that where they are also required to pay a contribution to National Pensions Savings Scheme, they will reduce the contribution to their own scheme accordingly," he added.
However, Legal and General believes that many staff would be better off not joining the scheme, such as people with debts and those on low income who face means-testing.
Auto-enrolment onto the National Pensions Saving Scheme is part of the government's reform, along with raising retirement age to 68 in the future and restoring a link to earnings.
NPSS gives 3 company pension choices, expert says
Pensions Quote Line
0845 108 0505
NPSS gives 3 company pension choices, expert says
Tue, 06 Jun 2006
Recommended links
Pensions informationGet a free pension quote
Retirement needs more savings, Prudential warns
Pension income higher in south-east, study shows
Millions could benefit from company pensions
Sean Connery top pensioner, says pensions company
Pensions.co.uk is part of a large network of financial sites created to help advise you on life events, such as buying a house, Mortgages.co.uk; insuring your car - CarInsurances.co.uk; your life - LifeInsurance.co.uk; and your home - HomeInsurance.co.uk.
1998 - 2008 UK Pensions - Planning before, at the onset and during retirement.
| pensions news |
|---|
| UK should adopt overseas pension ideas, survey suggests - Tue, 18 Nov 2008 |
| Credit crunch causes pension crash - Mon, 17 Nov 2008 |
| Company pension laws to be reviewed - Thu, 13 Nov 2008 |
| More News |
Pensions Newsletter
Please enter your email below and subscribe to our monthly newsletter
Save on Your Mortgage
Would you like to save money on your mortgage? Fill out our quick mortgage enquiry form.
Protect Your Health
Find Critical illness, Life and Private Medical Insurance PMI policies.