Pensions minister explains personal accounts

Fri, 25 May 2007

Details of the proposed national pensions savings scheme have been delineated by the secretary of state for work and pensions John Hutton.

In an address to a symposium arranged by the National Association of Pension Funds, Mr Hutton expressed his belief that the introduction of the personal accounts pension vehicle will prove to be "the biggest step forward" for employees looking to make contributions to a pensions scheme since the advent of national insurance.

And he has now confirmed that personal accounts will be run by trustees as a trust-based company pensions scheme.

Commenting on the decision, Mr Hutton explained why it would help to improve the personal accounts system as a whole.

"Protecting the interests of members underpins our decision to establish the scheme as a trust-based occupational pension," he said.

"They will face the very same level of regulation as all other trust-based occupational schemes."

Under the government's proposals, the national pensions savings scheme is set to be rolled out in 2012.

It has been designed to encourage employees to begin saving a greater proportion of their earnings for retirement.

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