Thursday, July 12, 2007

UK pensions to become mandatory?

In the first ever Summer Statement outlining the formal Gracious address which in turn contains the legislative programme of HM Government, Gordon Brown said the following:
The new Pensions Bill will ensure that for the first time not just some but all working people have the right to a workplace pension with a duty on every employer to contribute towards it.

We can only interpret this to mean that occupational pensions will go from contingent to mandatory for everyone in the UK. The implications of this change for the European first and second pillar classification, which critically relies on the non-mandatory nature of occupational pensions in contradistinction to social security, may be huge. This criterion, which is dispensable in our view, would be a major technical impediment to the eventual application of the Pensions Directive to Switzerland with its mandatory occupational pensions system.

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