The Government has admitted that stakeholder is not hitting the original target market, according to...
The Government has admitted that stakeholder is not hitting the original target market, according to Nigel Stammers, pension strategy manager at Clerical Medical. Speaking to Investment Week, pensions minister Ian McCartney said that stakeholder was targeted at 'middle and high income earners.'
McCartney said lower earners would be targeted by the minimum income guarantee and the state second pension. Pensions credit would mean they would not lose out if they did make private savings, he added.
This appears to contradict the original position of the Government which said stakeholder was aimed at those earning between £9,000 and £18,500 per year. The Department of Social Security launched its strategy for pensions, Partnership in Pensions, in 1998. It said: 'Stakeholder is designed to help those on middle incomes start their own pension but will benefit those on higher incomes too.'
Stammers commented: 'They do seem to have shifted away from the original target market and I think they are concerned about the low level of take-up.'
Howard Flight, shadow secretary to the Treasury, also argued that the goalposts have been shifted. He said: 'The claim that it was always targeted at middle and high earners is completely disingenuous. It was originally set up for all those with lower incomes. Some 99% of those are by definition at the lower end of the income scale.'
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