The Association of British Insurers (ABI) has called for the Pensions Commission to become a permanent body in the hope it can increase the number of people saving sufficiently for retirement.
The proposal falls within yesterday's deadline, laid out by Adair Turner, for public responses and suggestions on the PC report and the crisis befallen UK pensions.
The trade body highlights three target areas for such a body to focus on, which it believes can be achieved by 2010 including:
Moving into the longer term, the ABI argues the Government should create policy which pushes towards a standalone goal of achieving ‘a replacement income in retirement (from the state pension and private savings) of a minimum 40% for everyone of previous earnings, rising to 70% for lower earners’.
The ABI adds compulsion should still be treated as 'as a last resort' while a voluntary regime should include state pension reform, attractive savings incentives, along with a wider base from which to draw financial advice and information.
The ABI adds its support to the launching of the Financial Services Forum during the year, a programme created to gather information regarding concerns “most frequently put to the industry," and where “consumer groups, the FSA and Government could work together more effectively to improve consumer service and boost levels of saving," the ABI says.
Meanwhile, the Financial Services Consumer Panel has also backed a Pension Commission suggestion for a general financial planning advice service so that consumers can be included in measures taken to tackle pension provision.
The panel also called for the second report due to focus on ‘practical solutions for future pension funding’ to also deal with the advice gap, adding the importance for people to have access to ‘impartial advice’ on how to handle their individual situation.
Dianne Hayter, vice chairman of the Consumer Panel says: “Impartial advice for consumers on planning for their retirement is the missing link at present. Consumers will be encouraged to save if they can work it through with some person or system which is well informed, but not interested in selling a certain financial product.”IFAonline
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