DC contracting-out to be scrapped from 2012

Sources reveal the move will essentially be to pay for reforms to the state pension, as the removal will save the government about £3bn a year in National Insurance (NI) rebates. The situation on whether the move will be extended to defined benefit (DB) pension schemes is not clear, although as the scrapping of contracting-out of defined contribution (DC) is planned for just two years later than the 2010 date suggested by the Pensions Commission, it seems possible the government may continue to follow Lord Turner’s proposals to abolish contracting-out for DB schemes by 2030. Just by scra...