Stakeholder pensions remain ‘empty boxes’

New research today reveals that 82% of employer-sponsored stakeholder pension schemes remain ‘empty boxes’ with no pensions yet active.

The survey, entitled 'Stakeholder pensions – time for change' by the Association of British Insurers (ABI), revealed that 1.5 million stakeholder pensions have been sold since April 2001; 350,000 employers have designated a scheme – but 82% remain empty boxes with no members; and only 13% of employer-based schemes have employer contributions.

Commenting on these results, Mary Francis, Director General of the ABI, said her Association would be calling for more action to help employers to promote pensions take-up.

In their recommendations, the ABI said it would be proposing a five-point Employer Action Plan to be taken up by the Government’s new Employer Taskforce.

These would include:

• a Government-led programme to encourage employers to promote the schemes they sponsor
• permitting employers to promote the schemes they sponsor, eg by exempting them from the Financial Promotions Order
• helping employers meet the costs of advice through a Workplace Advice Tax Credit
• giving practical help to employers via the Government’s proposed Employer Information Pack
• requiring employers to do more – e.g. requiring them to give each employee a leaflet about the scheme they sponsor.

“Pensions are inextricably linked to the workplace. Our proposals will involve employers and help them help their workers," Mary Francis Director-General of the ABI concluded.

(MB)