MSE News: All companies to offer workplace pensions 27 October 2010 at 11:32AM in Pensions, annuities & retirement planning 31 replies 3.5K views

Former_MSE_Guy

This is the discussion thread for the following MSE News Story:

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All companies to offer workplace pensions

chattychappy

Another 3% tax on employers for employing people in the UK in addition to what they already pay in NI.

People's old age is their own responsibility (or "society" as a whole). It's not the responsibility of companies. If the government feels that people should be setting aside 3%+4% for their old age and can't/won't do it by themselves, then the full 7% should be taken out of employee wages.

HairY

So a pension scheme that workers and employers both pay into? Isn't NI and the State Pension already funded by contributions in this way?

What is really going on here? Isn't this just an additional State Pension which you can opt-out of?

Reaper

HairY wrote: »

So a pension scheme that workers and employers both pay into? Isn't NI and the State Pension already funded by contributions in this way?

You might think that your contributions went into a pot to be invested for when you need it but sadly not. Instead the government spends everything it gets and relies on contributions from future generations to pay for your pension. The ticking timebomb is an aging population that needs its pensions paid for by a shrinking workforce that it will be unable to afford. That is why you would be crazy to depend on living off the state pension in the future. Since the government is incapable of saving they want individuals and companies to do what they should have done in the first place. As such it is the best of a bad situation.

wotsthat

Isn't NI and the State Pension already funded by contributions in this way?

You should be on stage!

Isn't this just an additional State Pension which you can opt-out of?

Yes but with a cunning twist. Whereas now many people are too apathetic to start saving for old age the Government are hoping they'll also be too apathetic to stop saving once the scheme starts.

You've got to be a pretty committed non-saver to turn down free money - it'll be interesting to see the opt-out rates.

chattychappy

wotsthat wrote: »

You've got to be a pretty committed non-saver to turn down free money - it'll be interesting to see the opt-out rates.

Yep, much of it "forced" from your employer.

HairY

wotsthat wrote: »

Yes but with a cunning twist. Whereas now many people are too apathetic to start saving for old age the Government are hoping they'll also be too apathetic to stop saving once the scheme starts.

People might not be quite so apathetic and unopinionated if the media start reporting how poorly the NEST fund is doing. If this happens the people will blame Government, not the private caretakers.

wotsthat

chattychappy wrote: »

Yep, much of it "forced" from your employer.

I thought I was a cynic!

I bet there'll be employers who'll give one-off bonuses to those who opt out. It's good timing really because the CBI will be able to say that the rush for new flat screen TV's is down to the Olympics and nothing to do with employers buying off their staff.

wotsthat

People might not be quite so apathetic and unopinionated if the media start reporting how poorly the NEST fund is doing. If this happens the people will blame Government, not the private caretakers.

Maybe, but there are still plenty of people who shell out a load of cash for gyms that they don't attend and if the employee contribution is taken from a pay packet rather than a bank account then who knows how the psychology will work. As the saying goes 'I used to be apathetic but now I can't be bothered'....

There's a chance (slim because a Government is involved) that the NEST fund will perform quite well and we'll all live happily ever after.

HairY

wotsthat wrote: »

You should be on stage!

wotsthat wrote: »

There's a chance (slim because a Government is involved) that the NEST fund will perform quite well and we'll all live happily ever after.

Side-act?

BlondeHeadOn

Does this apply to all companies, even one-man-band limited companies? Sounds a potential real pain..

Also what about sole traders (I have a vested interest here)? Presumably, not being an employee, I am exempt?