The government's pension reform will not offer security after reaching retirement for many UK residents, an expert has claimed.
Financial security will become a "fantasy" for many UK residents if they undergo means testing because their state pension is too low, asserted Stewart Ritchie, president of the Faculty of Actuaries.
Mr Ritchie commented as the Actuarial Profession launched its response to the Pensions White Paper, titled Security in Retirement – Towards a New Pension System.
"Auto-enrolment for many lower earners may simply mean that private pension replaces mean-tested pension and several million such employees may have little extra to show for the personal account contributions of themselves and their employers," Mr Ritchie remarked.
"Combining this with the absence of advice could be an explosive mix, leading to a breakdown of trust."
However, the Association of British Insurers recently stated that the implementation of personal accounts could increase total levels of pension saving and help to provide a better income for many UK residents upon reaching retirement.
The body claimed that industry professionals were "enthusiastic" about the proposals.
Government pension reforms fail to offer security, expert claims
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Government pension reforms fail to offer security, expert claims
Thu, 14 Sep 2006
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