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Pension contribution cap proposals attacked
Fri, 25 May 2007
The majority of pension holders have spoken out against proposals to impose a mandatory contribution cap for personal accounts .

According to a survey of employees who would be eligible to open a personal account from consumer group Which?, 12 per cent of respondents agreed that there should be an upper limit on how much they can pay in to the pensions vehicle.

Moreover, concerns have been expressed about the suggestion from elements of the financial services sector that annual contributions should be limited to £3,000.

While 18 per cent supported this figure, a further 42 per cent indicated that they would back a cap of at least £5,000.

Commenting, Emma Higginson, personal finance campaigner at Which?, said: "Personal accounts must not fall at this hurdle.

"The absolute priority must be a scheme that is designed to enable people to save in line with their aspirations for a comfortable retirement ."

As many pension holders may already be aware, John Hutton, secretary of state for work and pensions, has recently discussed the subject of personal accounts.

Discussing the pensions vehicle at the Manchester conference of the National Association of Pension Funds, Mr Hutton argued it was essential that personal accounts protect the interests of members.

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