24 February 2005 - Johnson unveils principles to guide Pension Reform
The principles set to underpin reform of state and private pensions, were outlined today by the Secretary of State for Work and Pensions, Alan Johnson.
The six principles will be the criteria against which further reform, including the recommendations from the Pensions Commission, will be evaluated.
They are:
- The pensions system must tackle poverty effectively
- The opportunity to build an adequate retirement income for all
- Public pensions provision must remain sustainable
- Fair outcomes for women and carers
- A better understood system
- To go forward, where possible, in consensus
Alan Johnson said:
“Pension policy spans Parliaments, Governments and generations. As the Pensions Commission made clear, the full impact of the ageing society won’t be felt for two decades so the last thing we need are knee jerk reactions offering instant solutions for today but no recognition of the burdens imposed on future generations.
“Various organisations are putting forward very different proposals for pension reform. We must engage seriously with all of these, but as yet there is no consensus on the detailed way forward. As a first step, I’m today outlining principles for pension reform which should give us an agreed framework in which to evaluate all the options and define a way forward.”
Today’s document identifies a number of important questions the Government will need to consider including:
- Whether a residence-based eligibility for the basic State Pension could be a practical and cost-effective way forward?
- Whether National insurance rules and qualifying conditions could be modernised to create entitlements to the basic State Pension that better reflect today’s society?
- Whether we could harness the power of the state through local and central collection mechanisms to make it easier and cheaper for people to save. Might running such a product on an auto enrolment basis help more people save?
Pensions Minister, Malcolm Wicks, said:
“With these principles, the Government makes clear that we are serious about a mature and long term debate. Ahead of the Pensions Commission's recommendations the Government will promote a national debate on these principles. In this way we hope to achieve a shared framework within which the recommendations of the Commission and others can be assessed.”
Notes for editors
- Principles for reform – The national pensions debate was published today and is available at www.dwp.gov.uk.
For Braille, audiocassette or Welsh versions, please email principles-for-reform@dwp.gsi.gov.uk. - Pensions Act received Royal Assent on 19 November and can be viewed at: http://www.hmso.gov.uk/acts/acts2004/20040035.htm#aofs
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