Article date: 17 March 2006
Norwich Union believes that the broadprinciples for the creation of a simple, low cost pension, asproposed by the Pension Commission, can provide a much neededplatform for the nation’s future retirement planning.
Norwich Union’s ownproposals for a sustainable and successful new pension schemeare:
- A single account opened by the individual that moves withthem between employers and evolves through their life stages
- A simple regulatory environment that protects consumersand where product suitability does not need to be demonstrated
- Charges of around 0.6% pa if auto-enrolment is mandatoryand the costs of advice are removed
- Minimum combined contribution of 8% from individuals,Government and employers
- A manageable choice of suppliers so that individuals canconfidently select an organisation that can provide a secure,long-term home for their savings.
Gary Withers, chief executive of NorwichUnion Life, said: “This is a unique opportunity to utilisethe knowledge and operational experience of the financial servicesindustry to work in a public/private partnership to deliver afirst-class pension scheme.
“Government and industry must work together to ensure thatthe national pension scheme adheres to three key principles: it issimple to understand and use, it encourages individual engagementand it minimises the burden on business.
“The new scheme needs to complement existing private pensionprovisions and be flexible enough to allow people to move in andout of the scheme as their circumstances change. Our proposals aredependent upon a radical overhaul of the entire state pensionsystem which will lead to consumers understanding what they willget from the state and what they will have to make provisionfor.”
Press office contacts:
Cheryl Cox 01904 452791 Outof hours 07800 695275
Louise Soulsby 01904 452617 Out of hours 07800 699 526
James Evans 01904 452396 Out of hours 07800 699525
Notes to editors:
- The high profile of pensions is necessary and welcomed, and isreflected in the two separate Select Committee enquiries whichhave been recently announced by the Work and Pensions andTreasury Select Committees. Norwich Union will be submittingresponses to each of the enquiries at the end of the month whichwill outline our thoughts in more detail on the national pensionsaving scheme (NPSS) and wider pension reform.
- Norwich Union is the UK's largest insurer. It is a leadingprovider of life, pensions and investment products and one ofthe largest Financial Adviser (FA) providers. FAs provide over70% of the company's long-term savings business in the UK.
- Norwich Union has strategic alliances with building societiesand other leading UK brand names including CIS and The RoyalBank of Scotland Group. Norwich Union’s news releases anda selection of images are available from Aviva's internet presscentre at www.aviva.com/media.