By Francesca James
The CBI has backed the Government’s pensions plans that will see millions of people working past 70 almost a decade sooner than the previous government had planned.
Today, the CBI commented on the Government’s forthcoming review of the UK’s pensions system
John Cridland, CBI Deputy Director-General, said:
“We welcome the new focus the Government has brought to reforming the UK’s pensions system. With people living longer than ever, we all need to save more for old age and find ways for people to extend their working lives.”
On the review of auto-enrolment and NEST:
“The independent review of NEST is a welcome step. We support the basic principles of the Turner Commission, but it is clear that the bureaucracy of the scheme has become complex and costly.
“We hope the review will address this, removing red tape for firms which already offer good pensions and revising the charging structure which could currently put off savers.”
On the default retirement age (DRA):
“Removing the default retirement age and right to request working beyond 65 would cause significant practical problems for employers. Both companies and staff benefit from having a clear framework for the timing of retirement.
“We have always supported raising the DRA over time, to allow people to work for longer.”
On the basic state pension:
“We are in favour of raising the basic state pension age gradually over time, probably reaching 70 by 2030. But it is also right to look at the structure of the state pension to ensure those who save more during their working lives are rewarded.”
On the review of public sector pensions:
“Public sector workers deserve a good retirement, but the gap between the contributions paid and the pensions accrued is £10bn a year and rising, with taxpayers left to make up the difference. This is clearly unsustainable. For many public sector employees shifting to a defined contribution pension, but without bearing the investment risk, could be the best way forward.”