Concerns raised over personal accounts
Concerns have been raised about the government's plan to introduce the personal account (PA) system of saving for retirement in the UK.
According to the consultancy firm Mercer, the Personal Accounts Delivery Authority (PADA) is on course to compromise some of the good quality occupational pension schemes that are already operating around the country.
The company maintains that the PADA's proposals for introducing PAs will have the effect of forcing employers to choose between a costly process of pension scheme restructuring or switching to what could be the less generous PA system.
Deborah Cooper, principal at Mercer, commented: "There are existing schemes that provide higher benefits for members on low to medium incomes than PAs.
"Faced with the inflexibility and complexity currently being proposed many are likely to throw in the towel and opt for personal accounts for all employees."
Plans to introduce the PA system across the UK in 2012 form a major part of what former prime minister Tony Blair said he hoped would be an "affordable and sustainable pensions system for future generations".
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