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10 October 2012

IPE: Pensions worried by auto-enrolment opt-out provisions


Lars Rohde, chief executive at the Danish pensions provider ATP, has expressed concerns over the long-term impact of opt-out provisions in the UK auto-enrolment law.

Rohde said allowing people to opt-out of the new "savings-based" system would complicate the provision of pensions for them from the tax and benefits system. He pointed out that in Denmark people were left uncovered by the labour market and corporate pensions systems who would expect additional pensions to the state provision. "Denmark is some years ahead of the UK in having this problem", he said.

He said he saw dangers in trying to run a savings-based pensions system in such conditions, adding that it may be possible to fool some of the people some of the time, but "not all of the people all of the time". Rohde also said that concerns about the UK's opt-out provisions had been among the reasons why ATP pulled out of the bid to run the National Employment Savings Trust (NEST) system.

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© IPE International Publishers Ltd.


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