The blueprint to overhaul the UK pensions system put forward by Lord Turner, chairman of the Pensions Commission, is the favorite to be implemented by ministers, despite rival plans from industry.
The pensions minister John Hutton has told the Financial Times that Lord Turner’s proposed national pensions savings scheme (NPSS) remains the government’s likely choice for a pension reform model.
In particular, Mr Hutton suggested that the low management fees proposed under the Turner model – 0.3% – were a key advantage. Industry representatives have poured scorn on the commission’s belief that such low fees can be delivered, however.
Amid criticisms from the private sector that the Turner model was too centralist, the government challenged the industry to come up with a better alternative. Among those mooted were a ‘supertrust’ idea (from the National Association of Pension Funds) and the ‘partnership pension’, advocated by the Association of British Insurers. However Mr Hutton appeared to tentatively reject these options:
The invitation was, who can beat that? [NPSS] And I’m not sure anyone has beaten it, he told the newspaper.