UK. History repeats itself with pension reforms
By John Roberts
Most aspects of our daily lives are affected by the whims and ambitions of politicians. This has been the case for pension provision right back to the early 20th century and beyond. For the financial services industry and the population as a whole, the effects of political decisions are coming home to roost for the second time in a generation.
As part of the self-reliance philosophy – distaste for state provision and the population’s reliance on it – Margaret Thatcher’s government introduced radical reforms in 1988, including personal pensions as we know them today, encouragement of individuals to opt out of the State Earnings Related Pension Scheme, and the right of employees to opt out of their employer’s pension scheme.
In the leadup to the reforms, costs for occupational schemes had significantly increased with the requirement for pensions in payment to be protected against inflation and equalisation of pension ages for men and women. With the political will of the government and the background of spiralling costs for schemes, reform was inevitable.
Read more @Money Marketing
