NAPF supports government on 'levelling down' concerns
The National Association of Pension Funds (NAPF) has welcomed the government's summary of responses to the white paper on pension reform.
It has voiced its support for the general approach towards pension reform outlined in the paper and the government's statement that it was taking seriously the risk that reforms could lead to a "levelling down" of existing pension provision.
The group claimed that if an employer switches from a standard pension scheme available today to the minimum levels set out under the personal accounts scheme, an employee on average earnings could be £3,000 a year worse off when they retire.
Joanne Sergars, chief executive of the NAPF, said: "We've made our concerns in this area known to ministers and the Department for Work and Pensions over the last few months and suggested a number of ways of reducing the risk."
She noted that the NAPF had suggested personal accounts be carefully designed, that employers offering good schemes be supported and the creation of a quality mark for pensions.
In September, insurance group AEGON stated that the threat of levelling down was a major one with pension reform and must be addressed by the government.
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