05 November 2009 - Post by:Andy Cork
With a general election looming in spring 2010, we’ve had a number of clients ask us where the political parties stand on pensions policy. I’ll come on to look at Labour and the Lib Dems in future posts on this blog, but let’s start with the Conservatives.
Pensions policy is currently dominated by the introduction of personal accounts and auto-enrolment from 2012. The Conservatives have been broadly supportive of the regime from the start, so don’t let a possible change of government stop you planning the shifts in your remuneration policy to position your business for 2012. There is still no real hint that the Conservatives plan to scrap the current government’s plans.
However, the summer has seen a small (but noticeable) change in position. Firstly, we had David Cameron saying that he was keen to see the system work, but that the Conservatives would “review the personal account situation” if they won the next election. Intriguingly, he said “we are working on a plan B, which does not involve starting from scratch again, but tweaking the architecture [of personal accounts]…”
All this seems to point towards Conservative support for the regime overall, but (maybe) a separation of auto-enrolment and personal accounts. It may well be that the Conservatives seek to introduce auto-enrolment as soon as possible but look to tweak the personal accounts regime should they win the next election. Their primary concerns are the delivery of the large IT system and the effect that personal accounts will have on those that would otherwise be entitled to means-tested benefits in retirement.
There are plenty of ifs and buts before any of this gets put into practice (not least the winning of the next election), but we are beginning to get a sense of what we might see from a Conservative government. We’ll update this blog as we hear more…
Andrew Cork is an associate at Allen & Overy LLP.