Norwich Union believes that the broad principles for the creation of a simple, low cost pension, as proposed by the Pension Commission, can provide a much needed platform for the nation’s future retirement planning.
Norwich Union believes that the broad principles for the creation of a simple, low cost pension, as proposed by the Pension Commission, can provide a much needed platform for the nation’s future retirement planning.
Norwich Union’s own proposals for a sustainable and successful new pension scheme are:
- A single account opened by the individual that moves with them between employers and evolves through their life stages
- A simple regulatory environment that protects consumers and where product suitability does not need to be demonstrated
- Charges of around 0.6% pa if auto-enrolment is mandatory and the costs of advice are removed
- Minimum combined contribution of 8% from individuals, Government and employers
- A manageable choice of suppliers so that individuals can confidently select an organisation that can provide a secure, long-term home for their savings.
Gary Withers, chief executive of Norwich Union Life, said: “This is a unique opportunity to utilise the knowledge and operational experience of the financial services industry to work in a public/private partnership to deliver a first-class pension scheme.
“Government and industry must work together to ensure that the national pension scheme adheres to three key principles: it is simple to understand and use, it encourages individual engagement and it minimises the burden on business.
“The new scheme needs to complement existing private pension provisions and be flexible enough to allow people to move in and out of the scheme as their circumstances change. Our proposals are dependent upon a radical overhaul of the entire state pension system which will lead to consumers understanding what they will get from the state and what they will have to make provision for.”
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Press office contacts:
Cheryl Cox 01904 452791 Out of hours 07800 695275
Louise Soulsby 01904 452617 Out of hours 07800 699 526
Notes to editors:
- The high profile of pensions is necessary and welcomed, and is reflected in the two separate Select Committee enquiries which have been recently announced by the Work and Pensions and Treasury Select Committees. Norwich Union will be submitting responses to each of the enquiries at the end of the month which will outline our thoughts in more detail on the national pension saving scheme (NPSS) and wider pension reform.
- Norwich Union is the UK's largest insurer. It is a leading provider of life, pensions and investment products and one of the largest Financial Adviser (FA) providers. FAs provide over 70% of the company's long-term savings business in the UK.
- Norwich Union has strategic alliances with building societies and other leading UK brand names including CIS and The Royal Bank of Scotland Group. Norwich Union’s news releases and a selection of images are available from Aviva's internet press centre at www.aviva.com/media.