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12 May 2016

People´s pensions “at risk” under new laws

A leading pensions expert has warned chancellor George Osborne that gaps in the current UK pension laws “could put the retirement savings of many thousands of people at risk,” BBC News reports.

Using the recent collapse of high street retailer BHS as a case study, whose pensions scheme now has a £571m deficit, the Work and Pensions Committee is looking into pensions regulation and the automatic enrolment of pensions.

Committee chairman Frank Field recently wrote to George Osborne calling for new rules as part of the Queen´s Speech. In the letter, Mr Field said that the committee had seen “concerning evidence” about “gaps in the regulatory framework” that had allowed “potentially unstable master trusts onto the market.” Some of this evidence came from the pensions regulator itself.

“Our evidence suggests that this could put the retirement savings of many thousands of people at risk,” Field wrote, adding that: “The committee´s inquiry into the Pension Protection Fund and pensions regulation is similarly encountering concerns over the range and effectiveness of powers available to both the regulator and fund trustees with regards to occupational pension funds.”

In light of the recent BHS events, Mr Field said that former owner of BHS Sir Philip Green should have his knighthood removed if he did not repay the £571m into BHS´s pension fund. In response, Sir Philip Green has called for Field to resign from his position as committee chairman, saying that he is “clearly prejudiced.”.

Mr Field´s comments were apparently made on a personal basis to the Financial Times, and have not been officially discussed by either the Work and Pensions Committee or the Business Innovation and Skills committee.

Copyright M2 Bespoke 2016

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