The survey was conducted over summer 2015 among the PMI’s members and represents a cross section of views of the industry’s pension professionals including managers, lawyers, actuaries, consultants and administrators. The latest findings from the survey reveal the contrast between the differing ages of PMI members, with the enthusiasm for a tax regime overhaul highest among the age group of over 50 years, with one in two saying that they backed making changes to tax relief.
The differing views among the three age groups are also underlined with an overwhelming four out of five (80%) of the younger PMI members saying that the complexity of the current system does not undermine the incentive to save to either a limited extent or at all, while by contrast only 51% of those 50 years and over feel the same.
High numbers across the age groups also felt that a change to an alternative system would not allow individuals to better plan for their retirement, with almost all (92%) of those aged 36 and under saying no, followed by 77% in the 36-50 year old age group, and 69% of those aged over 50. When asked whether they believed that a simpler system of granting tax relief to contributions would encourage people to save more, almost three out of four (72%) of 36-50 year olds said no, compared to 58% for both the younger and older age groups.
Kevin LeGrand, PMI President, said: “The message is clear from the younger PMI members – more change with the current system isn’t going to make a difference to encouraging people to save. Anecdotally they have told us that any further overhaul will only make people trust saving for a pension even less and undermine the system further - and the various results we have found clearly support this view. The older members, perhaps with their longer experience of seeing the pension landscape in this country work in so many different ways are less prepared to see the advantages of what we have now.
“We were surprised by the relative conservatism, and especially interesting is how there is a continuing backing for EET and that younger people in particular see it as an important aspect of their own pension planning. We also believe the most interesting aspect is the relative conservatism shown by younger members compared with older members, as the expectation is that it would be the other way round. Perhaps those younger members are able to look beyond the legacy of regulatory and legislative changes and see the benefits of the current system more clearly.”
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