The Pensions and Lifetime Savings Association (PLSA) has called for savings targets to be put into place in order to help individuals save adequate funds for their retirement.
According to research published by the PLSA, more than 13 million people have not saved enough for a comfortable retirement.
In addition, 78% of people aged between 18 and 64 are unsure of where to look to find out if they are on track with their retirement savings.
The trade association has suggested that the UK could look to implement retirement income targets, similar to those used in Australia.
Commenting on the issue, Graham Vidler, Director of External Affairs at the PLSA, said: ‘We all know we need to save for retirement, but few of us know how much we might need to live on or whether we are on track to hit that target.
‘We are . . . looking to develop a new set of retirement income targets that will empower savers by providing tangible targets for them to achieve. We look forward to working closely with stakeholders to build a retirement savings market which is truly focused on the end users – savers.’
The PLSA has launched a consultation on the matter, which will run until January 2018.
A survey carried out by the British Chambers of Commerce (BCC) has revealed that four in five businesses in the UK have been affected by rising costs generated as a result of changes to employment legislation.
In its Annual Workforce Survey, which garnered the opinions of more than 1,400 UK businesses, the BCC found that the Apprenticeship Levy, the National Living Wage (NLW) and pensions auto-enrolment have led to an ‘increase in the cost base of businesses’.
50% of respondents surveyed revealed that the NLW has helped to increase their employment costs, whilst 75% of firms reported a rise in costs as a result of compliance with pensions auto-enrolment.
Meanwhile, 20% of businesses have experienced rising costs as a direct result of the introduction of the Apprenticeship Levy.
Rising costs could lead to reduced investment and wage growth opportunities, the BCC warned.
Commenting on the findings, Jane Gratton, Head of Business Environment and Skills at the BCC, said: ‘Businesses are under increasing pressure from the burden of employment costs, and this will influence the choices they make and outcomes for employees.
‘Higher employment costs impact on the bottom line and reduce the resources available to invest in the business and its people.
‘At a time when employers across the country are facing acute skills shortages, it is vital that they have the resources and flexibility to invest in their workforce and the future needs of the business.’
The government has unveiled a new ban on pensions cold-calling, in order to protect savers from being targeted by ‘unscrupulous pension scammers’.
In addition to a ban on pensions cold calls, the government will also put in place measures to prohibit the sending of unsolicited pensions-related texts and emails.
HMRC intends to tighten up the rules in order to prevent scammers from targeting savers with fraudulent pension schemes. It will also ensure that only active companies producing regular and up-to-date accounts can register pension schemes.
Firms making cold calls without prior customer consent and businesses making calls to individuals with whom they do not have an existing relationship will incur fines of up to £500,000.
The announcement of the ban on pensions cold-calling comes as newly-published figures have revealed that nearly £5 million was stolen from savers by pensions scammers during the first five months of 2017. An estimated £43 million in pension savings has been stolen by criminals since April 2014.
Commenting on the ban, Guy Opperman, Minister for Pensions and Financial Inclusion, said: ‘If people have saved for a private pension, we want to protect them. This is the biggest lifesaving that individuals normally make over many years of hard work.
‘By tackling these scammers, people should know that cold-calling, apart from exceptional circumstances, is banned.’
The ban will be enforced by the Information Commissioner’s Office (ICO) once it comes into effect. Legislation in regard to the ban will be introduced ‘when parliamentary time allows’.
Data published by the Office for National Statistics (ONS) has revealed that retirement income has been ‘boosted’ by private and workplace pensions over the last 40 years.
The ONS found that 80% of retired UK households received income from a private pension in 2016, compared to just 45% of retired households in 1977.
It revealed that just 21% of retired households had an annual disposable income over £10,000 in 1977: in 2016, 96% of retired households had a disposable income of £10,000 or more.
The ONS also found that incomes have grown at a faster rate for older individuals than they have for the young.
Anna Dixon, Chief Executive at the Centre for Aging Better, said: ‘We have seen a dramatic and necessary reduction in pensioner poverty since the 1970s. Being financially secure is a key part of a good later life.
‘However, these averages mask inequalities. In particular, the growing disparity between those who have been unable to save into a pension and those who have not.’
Many consumers are taking out drawdown pensions without seeking regulated financial advice, the Financial Conduct Authority (FCA) has warned.
The FCA revealed that, before the implementation of pensions freedoms in April 2015, 5% of drawdown was purchased without advice, compared to 30% now.
A range of measures to address the issue have been proposed by the FCA, including gathering evidence on ‘consumer outcomes’ in order to assess whether extra protections should be put in place for those who choose to buy drawdown without obtaining expert advice.
The FCA has also urged the government to consider allowing individuals to access their savings early without being required to make a decision about the remainder of their pot.
Commenting on the issue, Christopher Woolard, Executive Director of Strategy and Competition at the FCA, said: ‘Since the introduction of the pension freedoms, the retirement income market has changed substantially.
‘We have identified areas where early intervention may be needed either now or further down the track to put the market on the best footing for the future.’
The Small Business Taskforce has outlined its priorities for UK small firms ahead of the General Election on 8 June.
The Taskforce, which is comprised of 14 organisations, including the Institute of Chartered Accountants in England and Wales (ICAEW), Enterprise Nation and the Entrepreneurs Network, has set out six key recommendations in its election manifesto, which it believes will help ‘build a positive and progressive business case for Britain’.
Amongst these key recommendations is a requirement for the next government to provide an environment which ‘champions the role of small businesses’, create a tax system that supports businesses of all sizes and supply business support that adds value.
The manifesto also calls for the next government to provide an advantageous pensions and benefits system, supply procurement opportunities that are beneficial to all and create a workforce that is equipped for enterprise.
Clive Lewis, Head of Enterprise at the ICAEW, commented: ‘Whatever the outcome on 8 June, the incoming government must provide a solid platform for small businesses to flourish and grow.
‘Currently businesses are cautious about the future and are holding back on investment, therefore it’s vital that, in the run-up to the General Election, all political parties spell out how they plan to encourage businesses to invest in long-term growth.’
The Government has launched a consultation on the new pensions advice allowance, which will permit those nearing retirement to withdraw up to £500 from their pension pots tax-free to put towards the cost of regulated financial advice.
This will enable individuals to receive advice on the various financial products that may contribute towards their retirement income, such as savings within an ISA and multiple pension pots.
The public consultation seeks views on the specific details in regards to the allowance, such as the eligibility age and how to promote the scheme effectively.
It also seeks input as to whether to allow multiple uses of the allowance in order to permit individuals to receive advice at different stages of retirement.
Simon Kirby, Economic Secretary to the Treasury, commented: ‘Pensions and savings decisions are some of the most important a person will make during their lifetime.
‘It is therefore vital that people can access the financial help they need and feel confident choosing the support that works for them in their retirement.
‘I look forward to the industry engaging with the pensions advice allowance consultation, and taking this opportunity to tell us how the allowance could best meet the needs of both consumers and firms.’
However, experts have warned that the allowance, which is set to come into force from April 2017, may not be available to all, and that £500 would not be enough to cover the cost of quality advice.
The consultation closes on 26 October.