Compulsory Pensions For All
66% of people in Great Britain believe that contributions to a pensions scheme should be compulsory for all employees, according to the results of a MORI survey released today by Towers Perrin, the benefit consulting firm.
The survey also shows that the general public is in the dark about pensions. 66% of people say they know they should be making better financial provision for their retirement but they are not sure what. There is also an issue of trust, as over half the people asked say they find it difficult to know whom to trust when arranging a pension.
More worrying from the Government's point of view, is the fact that despite all that has been written about Stakeholder Pensions, 75% of the population have not heard of Stakeholder, or knew nothing about it.
When it comes to pensions, people seem to get the message that they must rely on themselves (81%), but the reality of this has yet to sink in. They are wildly optimistic about their financial situation when they retire. 74% believe they will be financially secure, even though almost half of those questioned are relying on the state pension alone. Even though 52% say they have additional pension plans, 68% find it difficult to work out how much their current pension plan will give them when they retire.
Bruce Moss, Principal at Towers Perrin said: "These results should worry the Government profoundly. Despite all of the publicity surrounding stakeholder pensions, most people are still in the dark and looking for help. The Government's new stakeholder regime is likely to result in lower margins for providers and make it more likely that advice will not be readily available to those who need it most."
"On the basis of these findings, educating employees about what they should be doing to fund their pension is going to be a high priority, as it is likely that most employees will have a nasty shock when they get to retirement."
This survey supports findings from another Towers Perrin report, The Reaction to Reform , which included data from 150 organisations including 40 of the Top 200 UK companies. The survey found that only just over one-tenth of companies questioned thought that stakeholder pensions would provide adequate retirement income for employees who are not members of occupational schemes.
The companies questioned also believed that contributions to Stakeholder Pensions will need to be compulsory to make sure that employees have invested enough in their pension, echoing the view of the general public.
"Although the Government has ducked the issue of making pensions compulsory, employers and employees agree that it will be necessary to do so if people are to have an adequate income in retirement. In the meantime good employers will want to educate employees about the need to contribute to company and stakeholder pensions" said Bruce Moss.
The findings are being presented at the "Great Expectations" conference on Thursday, 17 February. Guest speakers include the Rt. Hon Frank Field MP.
Copies of the research are available from Towers Perrin by calling: 020-7806 6444.
To attend the press briefing on Thursday 17 February at 11.30am please call 020-7806 6447.
Technical details
Research carried out by MORI on behalf of Towers Perrin with a representative quota sample of 602 British adults, aged 18 - 60 (women) and 18-65 (men). Interviews were carried out by telephone throughout Great Britain between 8 - 11 February 2000. Data have been weighted to the profile of the population.
