STEVE WEBB RIGHT TO WARN ON SOLVENCY IITuesday 20 November 2012
Dr Ros Altmann, Director-General of Saga comments on Steve Webb’s warning on Solvency II:
STEVE WEBB RIGHT TO WARN ON SOLVENCY II
“Steve Webb is absolutely right to warn of the devastating consequences if Europe imposes the draconian requirements on UK pension schemes. These so-called Solvency II rules will result in Insolvency for many employers struggling to manage their pension liabilities.
“Europe has never properly understood how different our pension system is from other countries. These are not insurance schemes, so imposing insurance restrictions will ensure the employer pension promise is killed off for most workers.
“The Solvency II regime makes pension provision much more expensive and is the most costly way to try to fund pensions. Solvency II would force pension schemes to hold more gilts which adds hugely to pension costs. After the devastating impacts of QE and falling gilt yields, imposing these EU rules would kill off what's left of private defined benefit pensions.
“It is vital that our Government stands firmly against these crazy proposals which take no account of the differences between uk and other pension systems. This is a classic example of the dangers of trying to impose a one size fits all policy which doesn't actually fit. The EU needs to make allowances for national differences.”
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