Although the government's personal accounts scheme is likely to provide millions of people with pensions, one expert has suggested that the initiative needs to be amended.
Des Hamilton, technical director of The Pensions Advisory Service, said that personal accounts will be of benefit to people who would not have any other plans for providing an income when they retire .
However, Mr Hamilton said that the scheme has been designed to target those on medium to low incomes and may "simply replace" the mean tested benefits they would ordinarily be entitled to.
Despite this being an "inevitable consequence" of having a system of means tested benefits, this issue needs to be addressed, the expert commented.
"It needs to be ensured that people are properly advised and informed so that they can make decisions to stay in the scheme," he remarked.
There ought to be information highlighting the implications of means tested benefits to enable people to make the correct choice, Mr Hamilton added.
The Department for Work and Pensions states that the personal accounts scheme is aimed at the seven million people in the UK who are not saving towards their retirement .
Expert calls for personal accounts changes
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Expert calls for personal accounts changes
Fri, 04 Jan 2008
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