Pension reforms triple in cost

by Gill Montia

Story link: Pension reforms triple in cost

According to an exclusive report by news agency, Reuters, the cost of the Governments proposed pension reforms has risen 300%.

The cost of setting up the “Personal Accounts” scheme now stands at around £2 billion, up from an initial estimate of £500 million.

Personal Accounts are scheduled for introduction in 2012, at which point workers will be automatically enrolled unless they opt out.

The Personal Accounts Delivery Authority (PADA) is responsible for the development of Personal Accounts, the management of which will be handed over to a trustee corporation once the scheme is up and running.

However, the Authority is reported to be experiencing expensive difficulties and delays.

It is understood that the Government plans to recoup the money spent on setting up the scheme via a levy on Personal Account holders but the Association of British Insurers has already warned that all taxpayers, even those who opt out of the accounts, could end up footing the bill.