Ros Altmann, critic of current auto-enrolment contributions not being enough, is new pensions minister
The appointment of Ros Altmann as the new pensions minister could mean small-medium sized businesses may have to increase their employer pensions contributions in the future.
Altmann, the former director general of Saga, and Business Champion for Older Workers, has been a staunch critic of employers’ minimum contributions, claiming the current levels legislated for won’t provide an adequate pension for most people in their later years.
In her 2013 report, called ‘Pensions a Time for Change’ she said pensions needed an overhaul because the current system was“not fit for 21st century lives.” She said: “Even when [employer-employee] contributions reach 8%, this will still be insufficient to ensure a good pensions income.”
Speaking about her appointment, she said: 'I passionately believe the new pension reforms and trusting people with their own money, are an essential step to helping everyone make the most of their hard-earned savings.” She said she would also fight for consumers getting a better deal from pensions providers.
However, in the past she has been a critic of auto-enrolment. In 2012 she said: 'Joining is not the no-brainer that it's presented, especially by the Government.” She added “If you can afford it, it's probably a good idea. But pensions are just one way to save – and a very inflexible one. Paying off debts like student loans, or a deposit for a house, could be a better use of your money.'
As well as being critical of minimum pensions contributions, she is a well-known supporter of raising the private pension age (to allow people to work for longer).
It is expected Altmann (who was recently awarded a CBE for services to pensioners and pension provision), will conduct a review of pension charge caps, as well as look into improved rights for older mortgage borrowers.
To become minister, Altmann (who is not an MP) will be made a peer.