40% undecided on retirement strategies post April 2015

Pensions - thumbnail

More than 40% of respondents do not yet know what retirement options they will offer to pension scheme members when new flexibilities around retirement income come into effect from April 2015, according to research by JLT Employee Benefits.

Its 250 Club survey, which questioned 250 organisations, also found that 65% of respondents view the government’s decision to introduce flexible access to defined contribution (DC) pension savings positively.

The research also found:

  • 55% of employers have either told staff about the pension changes or have plans to do so. But 11% are not going to tell members (11%) and 34% do not know’ what they will do.
  • More than 80% of respondents either do not have a specific approach for managing older workers (49%) or do not know what their strategy is (34%).
  • 18% of respondents plan to review their retirement options before April 2015, while over a fifth of employers do not plan to make a decision until 2016.

Mark Wood, chief executive of JLT Employee Benefits, said: “This year’s Budget saw one of the most far-reaching reforms in pensions. So, although it was widely welcomed, it is putting a lot of pressure on the industry and employers, as well as adding complexity for individuals.

“While the industry as a whole has been pretty good in adapting itself, a significant number of employers are feeling overwhelmed and unsure how to respond.

“Employers have certain immediate responsibilities, such as communicating the changes to scheme members.”