New pension scheme unveiled

Plans for the automatic enrolment of workers into a new pension system are to be unveiled by the government.

From 2012, workers not in occupational pension schemes will be enrolled in “personal accounts” unless they opt out, under White Paper plans.

Philippa Gee, Investments Director of Torquil Clark comments: “In principle “Personal Accounts” could effectively herd a significant portion of the 10 million workers not in employer-funded schemes into a good retirement saving vehicle, this can only be good news.

The option to opt out inevitably weakens the proposal, as people will slip through the net. How this scheme is implemented and monitored with employers will be crucial. Measures, if any, to stop the less scrupulous pressurising employees to opt out or using this as an opportunity to reduce their existing offering, have yet to be disclosed.”