NEST today welcomed the OECD Roadmap on the Good Design of DC Pension Plans, launched at an OECD conference this week.
Speaking at the conference NEST chief executive, Tim Jones, said:
‘NEST has worked hard to understand the needs of the majority of workers in the private sector who currently have no pension and who will become the new saving mainstream. What our research has told us is that, above all, we need to get people saving and keep them saving.
‘For NEST, part of that process is managing their exposure to risk so they don’t ride an investment roller-coaster that will put them off saving for the long term. We have designed a sophisticated, dynamically managed default approach that carefully manages their exposure to risk in order to help give them greater certainty; an approach which is already winning awards.’
Pablo Antolin, Principal Economist, Financial Affairs Division, OECD, said:
‘The long term goal of the OECD is to ensure that DC pension plans continue to develop in line with the OECD Roadmap for the Good Design of DC Pension Plans. There is no one size fits all solution to the pensions crisis but the Roadmap provides a useful tool for all DC scheme designers.
‘In the UK, the development of NEST shows what can be achieved by following the Roadmap and we applaud their efforts to deliver meaningful returns to their members in retirement.’
In his remarks at the conference, NEST chair, Lawrence Churchill CBE, focused on what the European Commission say are the four problems with today’s pension systems:
‘Participation is being addressed by automatic enrolment, but we need to continue to focus on adequacy, security and fiscal sustainability.
Endorsing the NAPF’s PQM Plus recommended level of contributions, he said: ‘People shouldn’t be lulled into thinking 8 per cent is enough for the long term, but over time should be aiming for 15 per cent once automatic enrolment is fully bedded in.’
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