Dangling the pension carrot

In a paper entitled ‘Making Saving Pay’, the ABI says that abolishing contracting-out would have many severe disadvantages, particularly for salary-related pension schemes, however, financial neutrality makes it difficult for providers and advisers to give advice about contracting. Andy Agar, head of retirement product development at Legal & General, echoes this sentiment adding the issue affects 11 million people who are currently contracted-out through a personal pension. While the ABI criticises the present system as not providing enough incentive for people to opt out of the state ...