Nearly two-thirds (63%) of respondents believe that the abolition of compulsory annuity purchase will be the most beneficial of the government’s pension reforms for their workforce, according to the Employee Benefits/Close Brothers Pensions research 2014, which surveyed 216 respondents in September 2014.
More than half (53%) of respondents believe the incoming right to financial guidance at retirement will be most beneficial to employees.
But fewer respondents feel that measures such as allowing staff in defined benefit schemes to transfer to defined contribution plans and the new tax framework will be beneficial for their workforce. Just 20% and 19% respectively said this will be the case.
From April 2015, members of defined contribution pension schemes will no longer be required to purchase an annuity with their retirement fund and can instead opt for a cash lump sum, drawdown or an annuity. This will give employees much greater choice around how they access their retirement income and allow them to do so in a manner that best suits their lifestyle.
From this date, employees will also be given access to free, impartial guidance via a range of channels, including web-based, telephone-based and face-to-face methods.
The government reforms respondents believe will be most beneficial for their workforce
Abolition of compulsory annuity purchase 63%
A right to financial guidance at retirement 53%
Allowing employees in defined benefit schemes to transfer to defined contribution schemes 20%
New tax framework 19%
Changes to the minimum pension age 15%
Introduction of pooled pensions 11%
Do not know 7%
None of the above 3%
Sample: All respondents (216)