The National Audit Office issued a report yesterday on the DWP’s implementation of the new state pension, you can find it here.
The report is largely positive about the implementation of the reformed state pension, whilst acknowledging that in making scheduling trade-offs, the Department has foregone significant operational savings which it would otherwise have accrued. However the report also highlights that a key objective of the reforms is to deliver a simpler foundation state retirement income on which individuals could build their private savings, and on this communication challenge the Department has enjoyed only limited success. In April 2016 Just 25% of working age people knew how the changes to the state pension would affect them and 18% knew what their state pension is likely to be.
Tom McPhail, Head of retirement policy, Hargreaves Lansdown:
"If individuals can’t afford to retire in the years to come, it will mean the policies have failed. The Basic state pension isn’t enough for most people to live on so they need private savings too. Currently many millions aren’t saving enough for retirement and neither the new state pension nor the auto-enrolment programme will change this on their own. Good communication and engagement is vital to help individuals plan for their retirement. This is something which the government and the pensions industry alike have to deliver if we are to help individuals take responsibility for their own futures."
NOTES TO EDITORS
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