7 days
7 Days is a weekly round up of developments in pensions, normally published on Monday afternoons. We collate this information from key industry sources, such as the DWP, HMRC and TPR.
In this 7 Days:
- ACA publishes 2013 survey of pension trends
- DWP issues Pensions Bill 2013 information pack
- PPF Bulletin Published
ACA publishes 2013 survey of pension trends
On 30 December 2013 the ACA published its 2013 survey of pension trends.
As well as examining trends in pension contributions, the survey looks at firms’ experiences and expectations from auto-enrolment and their views on the Government’s latest workplace pensions proposals.
Key findings include:
- Employers reported that average rates of contributions into DC pension schemes have changed very little over the last decade. Contribution rates are generally failing to keep pace with the pension costs of longer life-spans and an economic climate with low investment returns.
- 57% of employers support the idea of “automatic escalation schemes” where pension scheme members are encouraged to increase their pension contributions at a future date often in line with increases in earnings.
- Eight out of ten smaller employers have not yet budgeted for the likely increase in costs arising from auto-enrolment.
- Whilst most smaller employers expressed no view on the principal Defined Ambition (DA) ideas that look to retain an element of DB, firms employing 500 or more employees said they were supportive of legislation to permit the following designs:
- Core DB schemes with no requirement to index benefits on an annual basis
- An option for a DB scheme where employers could automatically convert leavers’ benefits to a DC scheme (and possibly retirees’ benefits to an annuity)
- An ability for employers to adjust scheme pension age in line with changes in SPA or some other objective index.
- Six out of ten employers said they thought there would be a significant difference in the number of employees who would consider joining (or staying in) a DC scheme or who would pay higher contributions if the qualifying default fund secured a guaranteed pension income building up year by year.
- A clear majority of employers support a fixed-term pension enabling retirees to draw an income from a small pension pot over a few years rather than converting their pot into what might otherwise amount to a small monthly or annual retirement annuity.
DWP issues Pensions Bill 2013 information pack
On 3 January 2014, the DWP issued a Pensions Bill 2013 information pack.
This pack provides information on the measures in the Pensions Bill at its introduction to the House of Lords in October 2013, and contains information about the Bill’s passage through the House of Commons. It is not designed to replace the explanatory notes which accompany the Bill, but should be read in conjunction with them.
PPF Bulletin Published
On 3 January 2014, the PPF published its latest PPF Bulletin, rounding up all the PPF news from the last few months.
This edition includes information on:
- The 2014/15 Levy Determination, including key dates and deadlines
- The PPF’s progress towards it long-term funding aim
- The PPF’s investment team and its new Audit Services Panel.
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