comfortable retirement is being launched by the government.
The government is due to introduce legislation next year that will
mean people with money-purchase occupational pensions, personal
year outlining what they are likely to get when they retire.
Social security minister Jeff Rooker today launched the consultation
paper prepared jointly by the DSS and the Faculty and Institute of
Actuaries. It sets out how pension providers will have to calculate
Mr Rooker said:
'People need as much information as possible to plan for their
retirement. They want an annual piece of paper that will give them a
good idea - in plain English and with meaningful figures - of what
they will get from their pension.
'The difficulty with money-purchase schemes is the lack of certainty
about how investments bought from the contributions will perform in
the future. Providing illustrations in such circumstances is a
challenge but one that is important to meet for the sake of
'I am grateful for the work put in by the Faculty and Institute of
Actuaries, which chaired the working party that developed these
proposals. We now want to consult with the industry and get it
right,' Mr Rooker added.
1. The proposal to require money purchase schemes to provide
information about future benefits was first discussed in the
Pensions Green Paper in December 1998.
2. The changes will be introduced by means of amendments to
existing disclosure of information regulations. A Technical
Memorandum issued by the Faculty and Institute of Actuaries will
set out how the illustrations are to be calculated.
3. The necessary changes to regulation making powers are in
section 52 of the Child Support, Pensions and Social Security Act
4. The new requirements will start from April 2002, but the
regulations and the Technical Memorandum will be available in
early 2001 so that schemes can start earlier if they wish.